9:28 AM
Unknown
In line with Indonesia’s plan to benchmark coal price to international market rates and cash in on the opportunity African nations are now
planning to revise mineral laws and cash in on the boom in the coal prices. Mozambique’s government plans to revise the country’s mining
law and will seek to give the state a share of projects in “strategic sectors” such as coal. Some other nations reported to follow the suit
include Nambia and Zimbabwe. Currently ~50% of India’s imported coal comes from Indonesia and ~5% from Australia; Mozambique and
South Africa make up for the balance requirements. African nations were viewed as fallback options by Indian firms post the Indonesian
policy revision. I believe if African nations follow the Indonesian model of linking coal prices to international prices it will be a big blow for
the power and steel players coming up on imported coal and are running out .
Negative for power and steel companies in short to medium term.
