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MAKING MONEY FROM COAL REJECTS

Mandate

Coal processing companies generate "coal rejects", which they want to be continuously evacuated at the best possible prices. Companies find it difficult to fix the selling price of such rejects, due to the volatile nature of coal prices and because of the wide variation in the quality of such rejects.

A leading West Bengal-based coke producing company had 2,000 Mt of saleable rejects lying at its premises. It engaged coaljunction to find buyers for their rejects.

Objective

  • To sell coal rejects.
  • To get the best possible market price.

Strategy Adopted

To start with, coaljunction studied the nature of the coal rejects, a large percentage of which was in the form of fines and dust. coaljunction reached out to the consumers across the country who could use the rejected coal.

An eAuction methodology was deployed to ensure that

  • The client got the best possible price
  • The coal buyers got coal in their desired lot sizes and
  • The purchasing process was efficient and convenient

Key Achievements

coaljunction generated handsome revenues for its client by selling an item which was previously considered as a complete waste

Armed with high-end technology and in-depth market know-how, coaljunction can help organizations manufacturing Steel, Coke as well as Coal Beneficiation companies which generate coal waste to earn revenues - ensuring efficiency, transparency and a fair market price realization.

Business challenges

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  • A 3 years contract covered 20% of items. Price matrix was used consisting of cost of each component that goes into the assembly
  • All Prices used to be fixed for 3 years
  • Remaining 80% of items were procured through spot buys

The CoalJunction approach

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  • Vendors premise were visited to understand the cost elements and the manufacturing process.
  • Cost justification for each element has been defined to accommodate any future price revision
  • Cost break-up was obtained post sealed bid from suppliers who further matched the price matrix

Benefits to the client

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  • A 3 years contract covered 20% of items. Price matrix was used consisting of cost of each component that goes into the assembly
  • All Prices used to be fixed for 3 years
  • Remaining 80% of items were procured through spot buys

Testimonial

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I have noted that mJunction has become the world's largest marketplace for steel, and the goal set to bring in more transformations. mJunction team deserves to be complemented on these achievements. R. Gopalakrishnan Executive Director, TATA Sons Ltd