India: CIL's coal output falls 12% y-o-y in May'26, but healthy dispatches reflect strong demand

• CIL output falls 11% y-o-y in Apr-May, dispatches stay firm
  
  
• SECL's growth offsets weakness in other subsidiaries
  
  

Coal India Limited (CIL) reported stable coal production and stronger dispatch performance in May 2026, highlighting resilient coal demand despite continued output weakness across several major subsidiaries.

CIL's coal production stood at 56.1 million tonnes (mnt) in May 2026, remaining flat m-o-m compared with April. However, production was down 11.6% y-o-y from 63.5 mnt recorded in May 2025, reflecting weaker output from key mining regions.

In contrast, dispatches stood at 66.7 mnt in May, up 5.5% m-o-m from 63.2 mnt in April and 2.2% y-o-y against 65.2 mnt dispatched in May 2025.

Production pressure persists across major subsidiaries

The decline in CIL's overall coal production during May 2026 was largely attributable to weaker output from several key subsidiaries.

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MCL recorded the largest absolute decline, with production dropping 20.1% y-o-y to 14.3 mnt in May 2026 from 17.9 mnt in May 2025. NCL also reported a significant decline of 23.7% y-o-y, with output falling to 9.5 mnt in May 2026 from 12.4 mnt. Among the major subsidiaries, BCCL posted the sharpest percentage decline, with production decreasing 25.5% y-o-y to 2.3 mnt, while WCL saw output fall 8.4% y-o-y to 5.6 mnt, compared with 6.1 mnt in May 2025.

Offsetting some of these losses, SECL continued to outperform its peers, registering a 4.5% y-o-y increase in production to 14.4 mnt, up from 13.8 mnt a year earlier. Meanwhile, ECL recorded a modest decline of 3.6% y-o-y, with output easing to 3.9 mnt from 4 mnt, whereas CCL maintained stable operations, posting a marginal 0.4% increase in production to 6.2 mnt during the month.

Dispatch growth led by MCL and CCL

Coal dispatches showed a stronger performance than production, indicating healthy offtake from consuming sectors.

MCL recorded the highest dispatch volume at 18.8 mnt, up 5.6% y-o-y (around 4% up m-o-m) from 17.8 mnt in May 2025. CCL registered the strongest growth among major subsidiaries, with dispatches rising 17.3% y-o-y to 7.9 mnt from 6.7 mnt, while ECL reported a 6.4% increase, with offtake improving to 4.6 mnt from 4.3 mnt.

SECL continued its positive momentum, with dispatches increasing 3.1% y-o-y to 16.1 mnt from 15.6 mnt in May 2025. Meanwhile, WCL dispatches remained largely stable at 6.1 mnt, showing only marginal y-o-y variation.

In contrast, NCL dispatches declined 8.4% y-o-y to 10.4 mnt from 11.4 mnt, reflecting lower coal availability amid weaker production. BCCL also witnessed a sharp decline, with dispatches falling 18.9% y-o-y to 2.6 mnt from 3.2 mnt, largely due to reduced coking coal output during the month.

April-May performance trails previous year amid operational constraints

During the first two months of FY'27, CIL produced 112.2 mnt of coal, reflecting a decline of 10.6% compared to 125.6 mnt recorded during the corresponding period of the previous fiscal year. The lower output can be attributed to operational disruptions, adverse weather conditions in certain mining regions, and a higher base effect from the strong production levels achieved last year.

Despite the decline in production, cumulative coal dispatches during April-May FY'27 stood at approximately 130 mnt, marginally higher than 129.8 mnt in the same period of FY'26. The steady dispatch performance indicates resilient demand from key consuming sectors, supported by inventory drawdowns and continued offtake requirements from the power and industrial segments.

Outlook

The divergence between production and dispatch trends suggests that coal demand from the power and industrial sectors remains healthy, with inventories helping bridge supply gaps.

Going forward, monsoon-related disruptions, mine productivity, and evacuation efficiency across key subsidiaries will remain critical factors influencing production performance. While dispatches are expected to stay supported by power sector demand, sustained output recovery will be necessary to maintain comfortable supply levels during the upcoming monsoon season.