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Govt denies coal shortage in Indian non-power coal users

As power mills hoard most of the supplies, India’s aluminum smelters, sponge iron, textile mills, and fertilizer-makers face a coal shortage. 

However, the federal coal ministry and India’s high miner Coal India denied the coal shortage in Indian non-power coal users. 

Coal shortage in Indian non-power coal users

The Coal Consumers Association of India said that trains bringing coal dipped to 12-14 trains per day at end-January from 36 trains in August. 

The decline in trains supplies to the non-power sectors are lower than last year. 

Furthermore, eight industry associations, including the Aluminium Association of India and Fertilizer Association of India, pushed the govt to secure a “justified ratio of coal allocation between power sector and industries.” The letter, dated February 7, was addressed to Prime Minister Narendra Modi. 

While the associations did not provide exact figures of the shortage, industry officials claim that high prices and reduced imports caused panic and uncertainty. 

Moreover, industry officials also said that the government prioritizes coal shipments to power generators over non-power sectors. 

Coal India production

In response to the coal shortage, India’s coal ministry told Reuters that train availability to non-regulated sectors would improve. 

Furthermore, India’s coal ministry said they would address the trains shortage shortly. 

As large consumers depend on Coal India and increasing global prices, India’s coal imports dipped to a nine-year low in 2021. 

Moreover, an export ban by Indonesia and the Russia-Ukraine crisis has led global coal prices to reach record highs. 

Increased consumer dependence on state-run Coal India Ltd increased production to a record level in 2021. 

Nevertheless, the miners only catered to utilities – in line with its legacy of providing precedence to power plants. 

Non-power coal user sectors

Industry officials say high productions by Coal India pulled India through the worst power crisis for nearly four years. 

However, non-power sectors still face a lack of supplies from Coal India. 

The associations mentioned in the letter, “Industries are unable to ascertain the magnitude of crisis and plan for the future.” 

Lastly,

As the coal shortage increases, the non-power coal users suffer due to a lack of supplies. Nevertheless, India’s coal ministry aims to address the issue promptly. 

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