Major coal-importing nations, including India, will seek to increase domestic coal production to strengthen energy security and reduce dependence on fossil fuel imports, Moody’s Investors Service said Tuesday.
The government recently mandated CIL to import coal as an emergency measure to avoid coal shortages for the country’s power utilities and to build up buffer stocks.
“Large coal-importing countries like China and India will also look to increase domestic coal production to increase energy security and reduce dependence on imported coal. China’s coal production rose 15 percent in March 2022,” Moody’s Investors Service said.
Coal India Ltd aims to increase production by around 12 percent in the current year, the agency said.
The state-owned company accounts for over 80 percent of India’s coal production.
Moody’s Investors Service said metallurgical and thermal coal prices will remain high but below recent highs.
However, supply shortages eased, he added.
Copper, zinc, nickel and aluminum prices reflect low inventories and supply risks related to Russia. Supplies, which were scarce even before the disruptions from the military conflict, will remain tight, she noted.
“Steel and commodity prices have started to weaken as panic buying eases, supply chain issues reduce global demand, COVID-related lockdowns reduce consumption in China, and inflationary cost pressures and higher interest rates weigh on sentiment and economic growth,” the agency added.
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