Coal inventory days: a logistics and working-capital framework for Indian plants

Count usable tonnes, then choose the denominator

A stockpile is not a homogeneous cash balance. Some material may be restricted by quality, blend limits, location, handling access or a dispute. Begin with measured physical stock and reconcile the share that can actually serve the next operating schedule. Record the measurement time, quality basis and any excluded tonnes. The operational question is how much accepted fuel can reach the process when required.

Next disclose the denominator. Actual-burn stock days divide usable tonnes by recent consumption; forward cover uses scheduled demand; normative cover uses the applicable prescribed basis. The historical CEA framework uses 85%PLF and different month-dependent requirements for pithead and non-pithead plants.[S1] A facility should verify current rules and applicability rather than treating one generic stock-days number as compliance evidence.

Put the stock decision into cash terms

At an assumed delivered cost ofINR 5,000/t, the additional 50,000 t requiresINR 25 crore. At an assumed 12%annual carrying rate, its financing cost isINR 3 crore per year before storage, degradation or handling costs. The calculation does not prove the extra stock is worthwhile. It gives procurement, operations and finance a common denominator for comparing the buffer with an explicitly costed interruption scenario.

That scenario should include lost contribution, emergency replacement purchases, restart requirements and contractual consequences where applicable. Do not import an outage-cost number from a different plant. A flexible industrial process and a tightly scheduled generating station can assign very different value to the same extra day of fuel.

Measure the delivery chain, not just the supplier

The government’sJuly 2026 logistics update identifies rail congestion, rake placement and alternative-modal interfaces as constraints in coal evacuation.[S2] Build a route register that identifies the mine, siding, rail corridor or multimodal chain, handover point, unloading capacity and expected transit time. Track both dispatch and receipt. A dispatched tonne is not yet inventory available to the buyer.

For each material lane, measure average and adverse delivery times over a defined history. Identify common bottlenecks across suppliers, because vendor diversification may leave the physical route unchanged. Where a route has little operating history, show the evidence gap and use a labelled stress assumption. A planned infrastructure project belongs in a future-option column until its actual availability and access have been verified.

Use leading indicators to trigger action

An inventory alert should be forward-looking. Combine the current usable stock with confirmed incoming deliveries and the planned burn over the next scheduling window. Then run an adverse case that delays or removes the most uncertain receipts. The difference between the base and adverse stock path tells the team how much of the apparent safety depends on promises rather than fuel already controlled.

National snapshots provide context but do not replace this calculation. TheJuly 2026 Power Ministry statement reports thermal-plant coal stock on a specifiedJulydate.[S3] It cannot establish a particular plant’sNovember 2026 position. For procurement execution, dated transport events and the facility’s own consumption plan are more actionable than a stale national average.

Agree an escalation ladder before the disruption

The committee should define who acts when forward usable stock falls below an approved operating threshold, what alternatives are available and how long each takes to activate. A supplier call, an approved alternative quality, a different modal route and an emergency spot purchase have different lead times and authority requirements. List the relevant contracts and confirm that the option can actually be exercised.

• Daily: reconcile receipts, usable stock, planned burn and the next adverse stock point.
• Weekly: review route delays, unresolved quality differences and recurring receipt shortfalls.
• Monthly: refresh working-capital cost, alternative-route readiness and operating assumptions.
• After an event: compare the assumed lead time with the observed outcome and adjust the buffer policy transparently.

A disciplined buffer policy will sometimes hold more stock and sometimes less. Its credibility comes from the disclosed operational trade-off, consistent definitions and evidence from actual deliveries. The objective is to control a supply chain, not to maximise a stock-days headline.