October 4, 2026 - Coal inventories at India’s domestic coal-fired power plants declined 66% between April and September, placing renewed attention on mine output, transportation capacity and preparations for next summer’s electricity demand.

Stocks fell from 54.9 million metric tons at the beginning of April to 18.6 million tons at the end of September, according to an October 3 report by The Indian Express. The corresponding decline last year was 23%.

The figures measure coal held at power plants, rather than India’s total coal availability or underground reserves.

Reduced hydroelectric generation during deficient rainfall increased reliance on thermal power. Officials now consider replenishing inventories by March 2027 a major priority, although cooler weather and recent rainfall could ease electricity demand.

Deliveries Lagged Consumption

An earlier assessment by Crisil Intelligence helps explain the drawdown. Its September 18 analysis found that August inventories provided approximately nine days of fuel cover, compared with 17 days a year earlier—the lowest level in 34 months.

During April through August, thermal coal consumption increased 8%, while coal receipts at power plants rose only 3%. Railway rake loading increased 5%.

Crisil identified a mismatch between consumption and deliveries as the principal problem at that stage. Coal remained available at mine sites, but rainfall disrupted mining and transportation in eastern producing regions. Coal India subsequently allowed eligible power plants to collect additional supplies by road from September 7.

Production and Dispatches Improve

Coal India’s September production increased 9.18% from a year earlier. Deliveries to the power sector reached 48.9 million tons, up 10.63%.

The power ministry also reportedly directed approximately 112 captive coal-based plants to maximize generation from October 1 through December 31. Mandatory blending of imported coal remained under discussion, with no final decision reported.

The inventory decline could support additional overseas purchases. In a September 8 outlook, commodity analytics company Kpler forecast stronger Indian thermal coal imports during the fourth quarter as utilities responded to tightening stocks.

That forecast remains distinct from a confirmed government import requirement. For coal suppliers, the key developments to watch are sustained improvements in domestic dispatches, railway availability and the pace of inventory rebuilding.