State-run miner Coal India’s offer to e-auction this fiscal may surpass 10% of its total production with the mining behemoth likely to end the financial year with an output in the range of 610-615 million tonne.

The e-auction offer has already surpassed 69 MT between April to January and this quantity includes spot e-auction, special forward e-auction, special e-auction and exclusive non-power e-auction.

Lifting, however, seems to have been limited to around 60% of the total offer under a subdued demand condition.

According to a CIL official, in the latest e-auction held early this month under SHAKTI B(3) scheme, the premium fetched was 8.5% of the notified price with 6.5 MT of the 12 MT on offer lifted. “Our offer, it seems, will go up to 15% of the production but it is not necessary that the entire offer is off taken,” the official said, adding that 50% of the total offer has to go to the special forward e-auction and CIL has been making its offer according to the stipulated guidelines laid down by the government of India.

Prior to the auction, CIL was blamed that the offered quantity of 12 MT under the auction was too low against the requirement, inducing scarcity but after the conclusion of the auction, the actual booking found was only 55% of the offered quantity and the weighted average of the premium fetched was only 8.5%.

While CIL accepts that production this fiscal has taken a hit because of the prolonged monsoons, demand from the power sector was such that the production level was enough to create a comfortable stock pile at the power plants. Besides, the company could liquidate over 82% of its arrear rakes to the non-power sector during the ongoing fiscsal. The back log rakes pertain to FY18 and FY 19, the CIL official said.

The backlog arrears for the non-power sector which stood close to 5,140 rakes at the beginning of 2019-20 were cleared by 4,230 rakes. By the end of FY 20 we will be able to clear the rest 900 odd arrear rakes, a CIL spokesperson said, adding that supplies to non-power sector registered a growth of 4.4% at 95.45 MT during April to January this fiscal compared to 91.47 MT during the same period a year ago.

The combined coal stock, at CIL’s own pitheads and at coal linkage based thermal power plants of the country stands at 78.25 mt. Coal stock at power plants increased to a decade high of 36.36 mt, an average 20 day stock, just two days short of CEA mandated 22 days. Coal stocks at CIL’s pitheads stood at 41.63 mt. But CIL also is in a position to meet the power sector supplies when the demand picks up.

After the monsoon havoc, which impaired CIL’s production, the coal miner upped its production from October 2019 onwards gradually, when in January 2020 it posted a double digit growth of 10.3% over comparable month a year ago.

“But we cannot say there is a surplus availability scenario and the auction of linkages currently being conducted under SHAKTI B(3) window are taking into account availability of coal at the subsidiary coal companies and its current commitments under different contracts,” the official said. CIL is likely to hold another tranche of e-auction before the fiscal ends.