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Coal India cuts cost for top grade coal amid rising stockpile, price slump

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Coal India cuts cost for top grade coal amid rising stockpile, price slump

slashed pricesof high energy content coal by up to 40% due to a , coal production and a sharpdecline in global prices, The EconomicTimes reported April 12.

"Followinga rapid fall in international coal prices and a stockpile at pit heads, highenergy coal produced mainly from Eastern Coalfields, South Eastern Coalfields andNorth Eastern Coalfields have been slashed for volumes supplied over 90%,"the news agency quoted a senior Coal India official as saying on April 11.

Accordingto the official, the company has decided to waive the premiums charged for morethan 90% of contracted quantity of coal supplied in a year. The consumers nowget a 10% discount for receiving between 90% and 95% of the contracted volume,20% for volumes between 95% and 100% and a 40% markdown for volumes exceeding100%, said the report.

Theprice cut is being introduced on an experimental basis and will continue forthe entire fiscal 2016-2017, according to the report citing a senior powersector official.

Ifthe move drives power companies in buying more coal, the company may considerintroducing discounts for cheaper category of coal, noted the Coal Indiaofficials.

Thecompany's current stockpile amounts to 58 million tonnes, while a separate 39million tonnes of coal is piled up at the power plants, the report said.