Coal India curbs supplies to non-power customers, hitting industry

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State-run Coal India Ltd has temporarily stopped auctioning coal to non-power customers and is also reducing contracted supplies, potentially hurting companies in other industries as India battles one of its worst power supply deficits in years.

Workers drill at an open cast coal field at Dhanbad district in the eastern Indian state of Jharkhand September 18, 2012. REUTERS/Ahmad Masood/File Photo/File Photohas temporarily stopped auctioning coal to non-power customers and is also reducing contracted supplies, potentially hurting companies in other industries as India battles one of its worst power supply deficits in years.

Coal India, the world's largest coal miner by production, said in a statement that it had stopped all online auctions of coal except those meant for the power sector. An official added that supplies contracted through long-term agreements would be curtailed, although not completely stopped."This is only a temporary prioritisation, in the interest of the Nation, to tide over the low coal stock situation at the stressed power plants and scale up supplies to them," it said.

"The entire industry has been brought to a standstill and left with no time to devise any mitigation plan," AAI said in the letter, adding that coal inventories were at alarmingly low levels and high global prices had made imports unviable.

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