Facing Tepid Demand, CIL to Discuss Domestic Coal Use With Cement Consumers, CPPs

State-owned CIL will this week hold deliberations with the consumers of the cement sector and captive power producers (CPP) on substituting imports with domestic coal, amid the PSU facing tepid demand for the dry fuel.

Coal India (CIL) will hold discussions through video conference, the PSU said in separate notices to consumers of the cement sector and CPPs on Monday.

"In order to interact with the consumers for substitution of import by the use of domestic coal, a meeting has been scheduled by Coal India Ltd to be held on 18th June, 2020 for consumers of cement sectors through video conference " the notice said.

The deliberations with CPPs will be held on Saturday, the PSU said in the notice.

"In this regard, consumers (cement and CPP)....are requested to join the meeting to discuss & deliberate on the issue related to the substitution of coal import," it added.

CIL continues to be beset with tepid demand for coal, with most of its customers, like the power sector, shying away from lifting adequate quantities.

In a bid to facilitate import substitution and boost its supply volumes, recently, CIL had asked the government to lower railway tariff for transportation of coal to customers.

CIL is primarily tapping domestic coal based power plants and non-power sector consumers who are importing coal.

They imported around 150 million tonnes (MT) of the dry fuel in 2019-20.

The PSU is looking to substitute their supplies with domestic coal.

The move would result in curtailing forex outgo arising out of coal imports and help CIL expand its supply volumes.

The power sector, which accounts for close to 80 per cent of CIL's total supplies, is brimming over with nearly 50 MT of coal stock, sufficient for 29 days of consumption, as at May-end.

Many plants have started restricting supplies from CIL further, shrinking coal despatches.

During May, the power sector lifted 30.15 MT of coal from CIL sources, down 25 per cent from 40.38 MT in the same month last year.

Coal India accounts for over 80 per cent of the domestic coal output..