CIL’s e-auction sales nearly tripled to 16.8 million tonnes (MTs) in October, amid a strong demand resumption for coal from the power sector.State-owned
The quantity of coal booked under CIL’s e-auctions stood at 5.8 MT in the corresponding month of the previous fiscal.The steep growth of 190 per cent, or an increase of 11 MT, during October, bodes well for Coal India Ltd (CIL) as it signals a strong demand resumption for coal after the COVID-led hiatus, the PSU said in a statement.
Volume booking in e-auctions for the first seven months of the ongoing fiscal stood at 59 MT, up 28 MT and translating into a growth of 90 per cent.
For a comparable period, last year, CIL booked 31 MT, it said.
The auction sale in October, in addition to the four prevailing windows, included a new auction outlet called special spot for coal importers, under which 1.6 MT of coal was booked.
In a first, CIL has introduced this category meant exclusively for coal importers to contain imports from abroad.
“This opened an additional avenue for our coal companies to step up their sales,” a senior executive of the company said.
Coal that went under the auction hammer during last month fetched CIL 13 per cent increase over the notified price.
With the onset of the COVID-19 pandemic, CIL has brought down the reserve price close to zero during the first half of the present fiscal. It was only in October, as a bellwether, CIL introduced an add-on ranging from zero to a maximum of 10 per cent over the notified price to test the market trend.
“From November onward we have reverted back to the pre-COVID status where subsidiaries of CIL will determine their own add-ons. Gauging the response, we are confident of stable auction sales and increased premiums in the ensuing months,” the executive said.
In a clear indication of growing demand from the power sector, CIL’s special forward auction, meant specifically for this sector, booked 6.5 MT in October accounting for 38.7 per cent of the total booked quantity of the auction.
Compared to the two MT booked in September, the growth has zoomed up to 225 per cent in October.
Unstructured coal markets composed of consumers and traders having no direct access for purchase of coal have shown healthy appetite in volume bookings as is evident from the spot auction and special spot auction applicable to all buyers of coal.
These two auctions with a booking of 5.4 MT constituted 32 per cent of October auction sales. Compared to 2.4 MT booked under these auctions in September the growth is 125 per cent.
E-auction booking during the first seven months of the current fiscal ending October fetched a premium of 10 per cent over the notified price.
During April-October non-power sector consumers in exclusive e-auction booked 12 MT more coal at 16.8 MT.
Propelled by the recent demand, power sector’s progressive booking ending October was 16.5 MT, under special forward e-auction – an increase of 3.6 MT or 28 per cent growth compared to 12.9 MT ending October last fiscal.
CIL accounts for over 80 per cent of domestic coal output.