New Delhi: Higher coal production in June led to a drop in prices
New Delhi New Delhi: Coal prices in the country have declined during June, indicating increased availability of the fuel to meet growing demand in the economy, according to a statement issued by the Ministry of Coal on Friday. “The National Coal Index, reflecting prices, has registered a significant decline of 3.48 per cent to 142.13 points in June 2024 as against 147.25 points in June 2023. This significant decline reflects adequate availability of coal in the market to meet the growing demand,” the statement said. The National Coal Index (NCI) is a price index that aggregates coal prices from all sales channels, including notified price, auction price and import price. It considers prices of coking and non-coking coal of various grades transacted in the regulated (power and fertilizer) and non-regulated sectors. Additionally, the premium on coal auctions reflects the pulse of the industry, and the sharp decline in coal auction premiums confirms adequate coal availability in the market, the statement said. Established with a base year of FY 2017-18, the NCI serves as a reliable indicator of market dynamics, providing valuable insight into price fluctuations. The downward trajectory of the NCI reflects a more equitable market, harmonising supply and demand dynamics. Coal production in the country during June this year grew by 14.58 per cent as compared to the same month last year. This has enabled stable supply to various coal-dependent sectors, contributing significantly to the country’s overall energy security, a coal ministry statement said.
India’s coal output rose 11.7 per cent to a record high of 997.83 million tonnes (MT) during the fiscal year ended March 31, 2024, Minister for Coal and Mines G. Kishan Reddy told the Lok Sabha earlier this month. The government is focusing on increasing domestic production of the fuel to eliminate unnecessary imports of coal in the country. Coal production has grown steadily over the last four years. According to data tabled in Parliament, the first quarter (April-June) of the current fiscal saw double-digit growth with a growth of 10.75 per cent to 247.396 MT. Steps taken by the government to increase coal production in the country include a single window clearance portal for the coal sector to speed up mining operations. As part of the new reforms, commercial mining auctions on a revenue sharing basis were introduced in 2020, which has led to more companies investing in coal mining, resulting in increased coal production. Coal companies, including the country’s largest coal producer Coal India Ltd, have also taken several steps to increase domestic coal production, such as adopting mass production technology. It is also using state-of-the-art technology in its high-capacity excavation machines, dumpers and surface miners. Apart from this, Coal India is planning large-capacity UG mines wherever possible, the minister said.
