Indian demand may boost Australian coal exports

By Steve Matthews – www.lloydslistdcn.com.au
Indian Government-owned Coal India is investing in new coal import facilities, boosting hopes for Australia's coal sector, which was already aware of projections this market would one day replace China as the dominant importer of raw commodities such as iron ore and coal.
India's energy demnds are expected to boom in response to its government's pledge to provide reliable power to its 1.1 billion people over the next decade.
Increasing demand has prompted Coal India to invest in a new import terminal at the south-east India port of Visakhapatnam.
In a joint venture with the Visakhapatnam Port Trust the new facility will be able to handle up to 6 million tonnes of coal imports when it opens in 2013.
According to Wood Mackenzie Consultants coal imports to India are set to double from 2008-2015 to more than 1 billion tonnes for electricity generation to support India’s rapid economic and industrial growth.
More than half of India’s electricity generation is coal fired.
By 2017 annual coal imports could reach 50 million tonnes.
India’s domestic coal production is forecast at some 535 million tonnes, but this will increasingly fall short of demand.
Reports suggested that Coal India would import coal from a variety of overseas sources through a joint venture with India’s leading electricity-generating utility firm, NTPC.
NTPC plans to import some 14 million tonnes in the current financial year to the end of March 2011 and expects to issue a new tender to import 4 million tonnes by the end of December.
Iron ore handling facilities are also being upgraded.
However it is unclear how sustainable the demand for coal will be given the Indian Government's moves on renewable energy.
About 10 per cent of the country's current energy demand is met from renewable sources.

Source: Lloyd’s List Daily Commercial News – www.lloydslistdcn.com.au
Additional reporting: Sam Collyer