Splitting coke imports into four-month seasonal intervals to account for the traditional length of the monsoon, the period with the lowest volumes varies from year to year. But it has never been June-September. In 2015 and 2017 it was February-May; in 2016, 2018 and 2019 it was October-January. Argus counts a fuel import as based on the date the ship departed from an Indian port — meaning after the cargo was unloaded — rather than the date that it arrived, as a ship can wait some time before discharging its cargo.
The highest monthly import volume of coke received in India over the past five years was in August 2016 at more than 1.81mn t, according to data from GAC Shipping. September and July volumes for that year were also historically high at 1.54mn t and 1.46mn t, respectively. This made the June-September 2016 monsoon season by far the highest volume for any four-month period over the last five years, with 5.8mn t. That compares with the next highest, February-May 2019, at 4.7mn t.
Coke demand in 2016 was particularly strong and India imported a record 13.8mn t that year. Coke was substituting a large amount of coal imports. A combination of factors came together at that time including a wide discount to coal and an increased environmental tax on coal. And the Supreme Court did not begin limiting coke until late that year.
Not all coke imports are for fuel, and demand from the metals industry may have less seasonal fluctuation. But anode-grade imports usually make up a relatively small portion of overall demand. The fact that India reached record volumes during the period that is considered seasonally lower shows that coal-to-coke discounts and freight costs have a much bigger impact on coke purchasing than overall cement demand for solid fuel.
The main reason for this is that coke makes up a small percentage of India's fuel imports. Even 2016's record volumes were still only 8pc of total solid fuel imports.
But a look at total coke and thermal coal imports combined suggests that seasonality may not be as large of a factor in Indian fuel demand as many believe.
June-September was the lowest import period for total solid fuel in 2015, 2017 and 2019. But October-January 2016/17 and February-May 2018 were the low periods in those years.
While June-September 2017 was the lowest overall period for fuel volumes, at 47.2mn t, October-January 2016/17, February-May 2018, and February-May 2020 were all lower than the next lowest monsoon season period so far recorded, June-September 2016. The highest volume of any period was February-May 2019, at 72.2mn t.
Volumes in June-September 2018 and 2019 were higher than the five-year average.
The monsoon rains are not always confined to the summer months. Last year saw a particularly heavy and long monsoon season that began in April and lasted until October.
This year's June-September imports are likely to be historically low, but this has more to do with the Covid-19 pandemic than seasonality. Total solid fuel imports in June were less than 8.1mn t, the lowest since at least 2015. May's 9.3mn t had been the second lowest.
But the five-year data suggest it is difficult to predict Indian solid fuel demand purely based on seasonality.