Coal India Ltd will put on offer 2.15 million tonne per annum of coal linkages for cement sector from June 28.

The company began the process of electronic auction of the coal linkages or fuel supply agreements with the sponge iron sector eligible in the bidding held between June 10 and June 16.

While demand has been tepid so far, Coal India expects an improvement from the cement sector.

Between June 10 and June 16, 3.78 million tonne per annum were on offer but bids were made for a much lower amount. In the first four days, out of 2.92 million tonnes per annum that were on offer only 1.64 million tonne per annum were sold.

Data for the remaining three days are yet to be released.

Coal India blamed the lack of demand to the slowdown in the steel industry which has been grappling with low prices to fend off imports.

Auctions for the cement sector were originally supposed to begin on June 23.

However, more time has been given to allow more bidders to participate.

For the current series of auctions for various sectors, a total of 23.75 million tonne per annum of linkages are to be put on the block. After the cement sector, coal linkages will be offered to captive power plants.

This is the first time coal linkages are being e-auctioned. Earlier, the fuel supply agreements were governed by the New Coal Distribution Policy of October 2007.

Requests for coal linkages were forwarded to the administrative ministries for their recommendations, which were then placed before the Standing Linkage Committee. But, despite the policy, no new linkage has been allotted to the non-power sector since 2007.

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