India may import 210 million tonnes of coal in FY16 as production lags

India is expected to import about 210 million tonnes of coal in the current fiscal in order to bridge the demand-supply gap as state-run miner Coal India Ltd (CIL) missed its production target for fiscal 2014-15 by around 3 per cent.

CIL, which accounts for over 80 per cent of the domestic coal output, missed production target for 2014-15 by 3 per cent, recording an output of 494.23 million tones against a target of 507 million tonnes.

The annual plan for the 2015-16 fiscal estimates coal demand in the country to be around 910 million tonnes and local availability at nearly 700 million tonnes, leaving a supply gap of 210 million tonnes.

"In the annual plan for 2015-16, all-India coal demand has been assessed to be 910 MT against which supplies from indigenous sources have been planned at 699.97 MT... with a shortfall of 210.03 MT, which is envisaged to be met through imports by consuming sectors," government data showed.

Of the total estimated supplies of 699.97 million tonnes, 550 million tonnes will likely come from Coal India, 56 million tonnes from Singareni Collieries Company Ltd and 93.97 million tonnes from other coal mines, including captive blocks, as per government data.

Besides lower production, the limited availability of requisite quantity and quality of coal as also infrastructural constrains like operational bottlenecks in coal transportation limit local availability of coal even in major coal bearing states of Jharkhand and Odisha.

The government may set a 550 million tonne coal output target for Coal India in the current fiscal. It has also set an ambitious target of raising the output of state-owned Coal India to one billion tonnes by 2019-20.

Meanwhile, CIL's production grew 10.5 per cent during the four month period the current fiscal (2015-16) over the year-ago period. The state-owned miner produced 34.83 million tonnes of coal in July, which is slightly below (97 per cent) the targeted output of 36.04 million tonnes for the month, Coal India said in a BSE filing on Saturday.

According to the filing, during April-July period, CIL produced 156.15 million tonnes of dry fuel which was 98 per cent of the targeted output of 159.07 million tonnes.

The coal production grew by 10.5 per cent during the four month period this fiscal over the year-ago period.

The offtake of coal during July this year was 40.88 million tonnes against the targeted 44.17 million tonnes.

During April-July period, coal offtake was 170.36 million tonnes compared to targeted 179.51 million tonnes. CIL's coal offtake grew 8.1 per cent in April-July this fiscal compared to April-July period last year.

Coal India is expected to increase coal production by around 60 million tonnes in the current fiscal over the output in 2014-15.

In 2014-15, the company's total coal production increased by 31.81 million tonnes to over 494 million tonnes, recording nearly 7 per cent growth over 2013-14.