New Delhi: Coal imports may fall this fiscal due to high global prices triggered by the floods in Australia, the coal minister Sriprakash Jaiswal said on Thursday, which could impact power generation and earnings of steel, power and cement firms.
Devastating floods in Australia’s northeast have hit the country’s $50-billion coal mining sector hard, pushing prices to one-year highs.
“ The floods in Australia, and cold weather in South Africa have led to a sharp increase in coal prices globally...this may impact coal imports,” Sriprakash Jaiswal told reporters on Thursday, without elaborating on the likely decline.
India has 10% of the world’s coal reserves, the biggest after the United States, Russia and China, but imports have grown rapidly and the country had plans to import 84 million tonnes in the current financial year.
Coal-fired plants account for about half of India 168 gigawatts installed capacity.
Jaiswal had earlier said the country’s coal deficit would rise an annual 24 to 104 million tonnes in the next financial year ending March 2012.
The minister, who also said state-run Coal India may look at raising prices after July, added the country’s first coal blocks auction may take place during April-September.
The coal ministry is drafting guidelines for auctioning coal blocks to replace the earlier system of coal block allocations, which failed to boost production.
Macquarie Bank forecasts coking coal prices may rise by more than 22% percent in the June quarter from the current quarter, while consultants Wood Mackenzie said prices may hit $500.
Thermal coal was priced at $132.57 a tonne on globalCOAL Newcastle index for the week to Jan.