Additionally, the Pithead Coal Stock at Coal India Limited (CIL) as on 23.08.23 stands at 46.13 MT, showcasing a growth rate of 45.5% as compared to the stock of 31.70 MT on 23.08.2022. This upward trend highlights effective stock management strategies and operational efficiency.

In terms of Coal Dispatch to the power sector, the cumulative achievement for the FY 2023-24 as on 23.08.2023, amounted to 307.97 MT, registering a notable growth rate of 5.6% compared to the corresponding period of the previous year ensuring a steady supply of coal to meet the energy requirements of the power sector.

Overall, Cumulative Coal Production for FY 2023-24 has witnessed remarkable growth, with a production of 340.31 MT up to 23.08.2023, representing an impressive growth rate of 10.52% compared to the previous year's 307.92 MT up to 23.08.22. Furthermore, the Overall Coal Dispatch has seen a substantial increase, reaching 371.11 MT up to 23.08.2023. This represents a commendable growth rate of 9.58% compared to the previous year's dispatch of 338.66 MT till 23.08.22.

India's coal production rises 10.4% in four months of FY24

India's coal production of coal as reflected by the aggregate output of CIL, SCCL and captive coal mines for the month of July 2023 increased by 14.93% yoy to 69.29 million tonnes (MT). The production of CIL increased by 13.4% yoy to 53.67 MT, while production of SCCL was up 31.1% yoy to 4.30 MT of coal. The output of allocated captive coal mines for the month rose 16.94% at 11.32 MT.

Coal despatch/off-take by CIL, SCCL, and captive coal mines altogether for July 2023 grew by 12.49% to 75.99 MT and of which CIL contributing 59.51 MT (up 9.29% yoy), SCCL contributing 4.59 MT (up 36.49% yoy), and captive coal mines contributing 11.89 MT (up 22.06% yoy).

For the July 2023, the production of CIL, SCCL, and captive coal mines stood lower than its despatch reflecting reduction in its Pithead stock to that extent. 

 CIL has achieved 102.62% of coal production target of 52.30 MT and 100.95% of despatch/off-take target of 59.51 MT in July 2023, while SCCL achieved 89.96% of production target of 4.78 MT and 95.94% of despatch/off-take target of 4.78 MT during the month. Captive coal mines achieved 92.41% of production target of 12.25 MT and 97.05% of despatch/off-take target of 12.25 MT during the month. 

For April-July period of FY2024, Production of coal was up by 10.41% yoy to 292.65 MT powered by higher output from CIL which stood up by 10.65% to 229.15 MT and allocated captive coal mines, which stood up by 11.42% yoy to 42.10 MT, while the output of SCCL was up 5.98% yoy to 21.40 MT. Meanwhile, despatch of coal was up by 8.37% yoy to 316.74 MT, on the back of 6.26% yoy growth in coal despatch by CIL to 246.46 MT and 19.81% yoy growth in despatch from captive coal mines to 47.57 MT, while coal despatch by SCCL rose 10.08% yoy to 22.71 MT. 

For FY2023, Production of coal was up by 14.72% yoy to 892.74 MT powered by higher output from CIL which stood higher by 12.94% to 703.22 MT and allocated captive coal mines, which stood higher by 35.14% yoy to 122.38 MT, while the output of SCCL was up 3.26% yoy to 67.14 MT. Meanwhile, despatch of coal was up by 7.09% yoy to 877.45 MT, on the back of 4.96% yoy growth in coal despatch by CIL to 694.70 MT and 26.23% yoy growth in despatch from captive coal mines to 116.05 MT, while coal despatch by SCCL rose 1.79% yoy to 66.70 MT.

Production of coal for the FY 2022 was up by 8.56% yoy to 777.26 MT powered by higher output from SCCL which stood higher by 28.5% to 65.02 MT and allocated captive coal mines, which stood higher by 29.52% yoy to 89.60 MT. The output of CIL was up 4.4% yoy to 622.64 MT for FY 2022. Despatch of coal for the FY 2022 was up by 18.3% yoy to 818.14 MT. The coal despatch of CIL was up by 15.2% yoy to 661.89 MT and that of SCCL increased by 35.1% yoy to 65.53 MT. The despatch of captive coal mines was up 32.6% yoy to 90.72 MT for FY 2022. Coal despatch of CIL, SCCL and captive coal mines in FY 2022 period was higher than coal mined by it for the period reflecting reduction in its pithead stocks.

Coal despatches to power sector jumps 5.7% in July

Total coal despatch to different sectors increased by 12.49% to 75.99 MT in July 2023. The Power utilities coal despatch has increased by 5.7% to 61.65 MT, accounting 81.1% of total despatch to different sectors. 

The aggregate coal despatch to the power sector and captive power plants (CPP) combined for July 2023 was stood at 66.76 MT, an increase of 8.4% from corresponding previous month. These sectors contributed 88% of the total coal despatches in July 2023 as against 91% in July 2022. 

For April-July period of FY2023, total coal despatch to different sectors increased by 8.4% to 316.74 MT. The aggregate coal despatch to the power sector and captive power plants (CPP) combined during this period was stood at 279.40 MT, an increase of 6.7% from corresponding previous period. These sectors contributed 88% of the total coal despatches in April-July period of FY2023 as against 90% in April-July period of FY2022.

For FY23, total coal despatch to different sectors increased by 7.09% to 877.45 MT, supported by higher production and improved rail connectivity for all major mines under PM Gati Shakti - National Master Plan for Multi-modal Connectivity, which is targeted towards faster and efficient transportation of coal.  

The aggregate coal despatch to the power sector and captive power plants (CPP) combined during this period was stood at 784.04 MT, an increase of 9.1% from corresponding previous period. These sectors contributed 89% of the total coal despatches in FY23 as against 88% in FY22.

Coal Industry- A paramount lord of all industries

Coal is king and paramount lord of industry as it provides around 30% of the global primary energy needs and generates 40% of the world's electricity. India was the third largest producer of coal in the world in 2020 (behind China and Indonesia). In India, Coal is irreplaceable as prime energy and it would continue to be so in the foreseeable future. Coal accounts for around 55% of the India's primary commercial energy. Of the country's total power generation of 1378.525 Billion Units (BU) during 2020-21, including renewable energy sources, coal based generation was 950.751 BU which is around 69% highlighting coal's importance. Additionally, coal continues to stoke many non-power industries as well viz. cement, fertilizers, sponge iron, aluminium and a host of other industries.

Indian coal sector has seen a significant transformation in the recent times i.e. from being severely coal deficit to having good coal availability over the past 4-5 years. Coal India, the major coal PSU, accounts for more than 80% of the total supply share. Similarly, the Singareni Collieries Company (SCCL) accounting nearly 10% of the total supply.

In addition to increased supply, the coal sector has seen various changes in coal allocation mechanisms. For instance, sector specific auctions ensured the competitive availability of coal for key sectors. Similarly, a linkage auction for long term supply of coal to non-regulated sectors has enabled consumers to procure coal from CIL and SCCL in a transparent manner. Further, quantity increase in short-medium term auctions (spot, exclusive, etc.) has ensured availability of coal for all sectors.

Based on the demand projection in ‘Vision 2024' for coal sector in the country, coal ministry prepared a roadmap to project production plan in medium term wherein CIL has envisaged 1 Billion Tonne (Bt) coal production in the year 2023-24 to meet the coal demand of the country. To achieve this target, CIL has identified major projects and assessed their related issues. India's energy use is projected to grow at a rapid pace to fuel economic development, increased urbanization, improved electricity access, manufacturing base and rural electrification programme.

Based on the demand projection in 'Vision 2030' for coal sector in the country and subsequent demand projection on CIL, a Perspective Plan has been prepared to project production plan in medium- and long-term basis upto 2030-31 wherein CIL has envisaged to grow at the rate of about 7.6% till FY 2024-25 to meet the coal demand of the country. To achieve projected growth in production, CIL has identified major projects and assessed their related issues.

Domestic coal production gains 9.8% in June 2023

Domestic coal production increased by 9.8% to 74.66 million tonnes (MT) in June 2023 over June 2023. It was down 3.1% over May 2023.  

For April-June period of FY2024, coal production grew 8.7% to 225.78 MT. Coal production registered growth of 14.9% to 901.71 MT in FY2023 as compared to growth of 8.5% to 785.06 MT in FY2022, decline of 1.9% to 723.22 MT in FY 2021, decline of 0.4% to 736.90 MT in FY 2020, growth of 7.4% to 739.62 MT in FY 2019, and growth of 2.6% to 688.76 MT in FY 2018.

Outlook

Indian government continues to make remarkable strides in its pursuit of 'Aatmanirbhar Bharat' vision by ensuring energy security and enhancing coal production. Cumulative Coal Production for FY 2023-24 has witnessed remarkable growth, with a production of 340.31 MT up to 23.08.2023, representing an impressive growth rate of 10.52%, meanwhile Coal Dispatch has seen a substantial increase, reaching 371.11 MT up to 23.08.2023. This represents a commendable growth rate of 9.58%.

The government has taken several revolutionising steps in recent years to make the country self-sufficient in the production which started to give fruitful results, with India achieving 55 per cent growth in the production of coal in the last nine years. From 572 million tonne in FY2014, the production increased to 893 MT in FY2023 and the target is to produce over 1 billion tonne coal in FY 2024. Also, coal sector achieved a remarkable milestone in the first quarter ended June of FY24, by recording highest ever coal production at 223.36 million tonne (MT), representing a substantial growth of 8.55% compared to the production of 205.76 MT during the same period during FY23.

At the same time, as per recently finalised Action Plan for 2023-24 by the Ministry of Coal, the coal production target for financial year 2023-24 is 1012 MT by enhancing overall production, efficiency, sustainability and adopting new technologies. Also, Coal Ministry targeted to produce 1.3 billion tonne by FY25 and 1.5 billion tonne by FY30.

The Central Government has initiated several steps to ramp up domestic coal production in the country to achieve self-reliance, with 100% foreign direct investment has also been allowed for commercial mining. The coal ministry has auctioned 87 coal mines to date, generating an estimated revenue of approximately Rs 33,200 crores. Another 106 coal mines, including fully explored, partially explored, coking, non-coking, and lignite mines, are being offered in the seventh round of auctions, which began in March 2023.