India produced approximately 78.3 billion kilowatt hours of electricity in January, 1.8 billion kilowatt (2%) more than was produced in December and 4.9 billion kilowatt hours (7%) more than was produced in January 2012. Of the 73.8 billion kilowatt hours of electricity produced in India in January, a record 69 billion kilowatt hours was produced from thermal coal-derived generation. This is 1.7 billion kilowatt (3%) more than was produced in December and 5.8 billion kilowatt (9%) more than was produced in January 2012.

Indian thermal coal-derived electricity generation has now set records for two consecutive months (the previous record was 67.2 billion kilowatt produced in December). This has helped the dry bulk market (particularly panamax rates) in recent months, as Indian demand for imported thermal coal cargoes has previously been very strong. Indian power plant coal stockpiles have continued to increase during this period, however, which could result in an upcoming decline in Indian demand for imported thermal coal cargoes. This would most hurt the panamax and supramax markets.

Indian power plant coal stockpiles currently total approximately 17.2 million tons. This is a very robust amount of coal, and is the largest amount stockpiled in over three years. Indian power plant coal stockpiles traditionally peak around late April of every year, so it is likely that India's power plant coal stockpiles will increase further during the upcoming weeks. This would hurt the dry bulk market, as Indian demand for thermal coal cargoes would decrease. A decline in Indian thermal coal demand would most hurt the panamax and supramax markets, as these the two types of vessels most often used to haul coal cargoes to India.

Source from CNSS