The assumption is based on expected power generation growth of 1-2 percent in FY20 following improvement in availability of coal even though power generation had dropped 3.2 percent in April-December.
The coal production forecast is also based on steel production growth estimate of about 4 percent in FY20, the rating agency said in its Coal – Overview & Outlook.
Coal Prices
Benchmark international coal prices (Australian coal prices) fell by more than 30 percent since January 2019 from $98.6 per ton to $67/t in November.
China, accounting for around half of the total demand, remains the driving force behind the global coal market, it said.
“The country wants to become more self-sufficient in coal and has reduced its reliance on imported coal. Besides, abundance in availability of natural gas has also cut demand for coal,” the report said.
Slowdown in steel production in Europe, India and Japan has led to a fall in price of coking coal. Spot coking coal prices have fallen by 38 percent this year to $136 a ton.
Imports
Lower domestic availability of coal and softening international coal prices led to growth in imports.
This story is from the January 2020 edition of Coal Insights.
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This story is from the January 2020 edition of Coal Insights.
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