India’s coking coal imports have hit a five-year high at 47.97 million tonnes (mt) between April and January (10M FY24), with Russia and the USA being the major beneficiaries, whereas costlier Australian supplies ceded market share during this period.

Data from various ministries and trade sources show that Russian shipments coming into India shot up 140 per cent over a five-year period to 4.97 per cent in the April – Jan period and a nearly 180 per cent rise YoY. Five years back, coking coal shipments stood at 2.08 mt, while last fiscal it was at 1.77 mt. In FY21 (10 months), it was 1.95 mt, and in FY22, it was zero.

The rise coincided with India entering into a MoU with Russia for coal supply, a key raw material in steel-making.

India, the second largest crude steel producer globally, is the highest buyer of coking coal. Coking coal imports have remained at 47.5 mt levels for the last five years, but market dynamics have changed, data show.

Changing Market Dynamics

Russia displaced two other traditional suppliers – Canada and Mozambique – to emerge as the third-highest coke coal seller to Indian mills.

The USA was the other country to have gained significantly over the last five years. Buying of coking coal from the USA increased by over 150 per cent to 6.99 mt in 10M FY24. It stood at 2.77 mt in 10M FY20, as per data collated by market research firm BigMint (formerly SteelMint).

On a y-o-y basis imports were up 14 per cent-odd. It stood at 6.14 mt a year back.

Incidentally, Indonesia has also seen a doubling of supplies over five years to 2.6 mt, from 1.02 mt in 10M FY20. Supplies from Indonesia are more or less flat on a y-o-y basis.

Australia loses market share

“Indian mills have substituted higher priced hard coking coal from Australia with alternatives from USA and Russia. The dynamics have seen a change and Indian mills are de-risking supplies in a bid to control costs. Russian supplies continue to come at a discount still,” a Steel Ministry official told businesline.

But, Australia continues to be the dominant supplier. Share of Australian coking coal to total imports is now down to 60 per cent, the official said, as against 75 per cent five years back.

Between April - Jan, supplies stood at 28.66 mt, down 10 per cent y-o-y as against 31.63 mt in the year-ago-period. For 10M FY20, coking coal supplies were at 35.07 mt out of 47.12 mt (of imports).

Premium coking coal prices stood at $314 per tonne on Tuesday, down from the $325 per tonne range at the beginning of February. A year back, prices were hovering at around $389 per tonne.