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Monsoon Plays a Spoiler in Coal Production Augmentation

News

Output at staterun Coal India could drop in the current quarter due to monsoon rains, which hamper work at mines and slow down movement of railway wagons that the miner needs to evacuate coal.

Source: ET

SNP Insight

In the second quarter of FY 2014-15 the coal production increase by nearly 12% but misses the target by a narrow margin. To achieve 1 Billion tons domestic coal production by CIL in 2020 the PSU has to have coal production growth of 12% or more to achieve the target. But the flooding of open cast coal mines is going to hamper the coal production in monsoon period in a big way. Also the lack of coal transport facilities from coal mines also going to effect the annual coal output. So CIL has to come up with different strategy to boost up coal production growth to achieve 1 Billion tons by 2020.   

Source: SNP Infra Research