Industries, Jindal Steel & Power and Vedanta Ltd, have terminated the supply contract with Coal India to the two companies citing poor quality, pilgrimage and high transportation costs.
Coal India, said the cancelled steps appear to be a calculation as companies can now buy fuel at relatively low prices due to the overall drop in demand. Coal India has also reduced floor prices for the auction.
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The state-owned company is already facing a 21% drop in sales this year and making a record of pithed shares. A company executive said the contracts were secured through auctions between 2016 and 2018 when bids were placed in premium as coal supplies were low.
Central Coalfields, a subsidiary of Coal India, said that Jindal Steel and Hindalco opted to cancel the three contracts citing the supply of lower grade coal, while Vedanta did not give any reason.
.JPG)
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