Written by Sudarshan Varadhan
SINGAPORE (Reuters) – India's thermal coal imports fell by about a third year-on-year in October, according to data analytics firms Bigmint and Kpler, due to lower power generation and higher clean energy output.
Exports fell by 31.8% to 13.56 million metric tons, Bigmint data said. This was the fastest rate of contraction in fifteen months, and the first consecutive decline since July 2023.
Traders expect Indian imports to pick up in the coming weeks, but that won't be enough to lift total imports for the year above 2023 levels as shipments are expected to decline in the last two months of 2024 due to higher cargo at ports.
“Although industrial activity is low, traders have bought a large amount of coal from India,” said Vasudev Pamnani, director at Indian coal trading company I-energy Natural Resources Ltd, adding that thermal coal purchases in 2024 are expected to be flat. about 176 million tons.
Exports of India's fuel, which is mainly used for power generation, had tracked the growth of exports by China's top exporter in the past year, pushing up international prices.
The drop in Indian imports in October was the first major divergence between Indian and Chinese imports since mid-2023.
China's imports of thermal coal and iron ore rose 29 percent in October – largely due to imports of thermal coal – putting fuel exports on track to hit another record high in 2024.
While price-sensitive Indian consumers have shown a preference for cheaper domestic coal in recent months, analysts say imported coal is better priced than domestic varieties in China.
Lower power generation in China has led to higher reliance on coal in September, while higher power generation and solar have reduced reliance on coal in India, data available on Indian and Chinese government websites showed.
(Reporting by Sudarshan Varadhan; Additional reporting by Colleen Howe; Editing by Nicholas Yong)
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