Coking coal is an important raw material in steel making used as a fuel in Blast Furnace.
Even after being world’s 4th largest steel manufacturer, almost 70 per cent of coking coal requirement in India is fulfilled by imports.
During FY13, India’s Crude steel production capacity was 91.7 MnT and Steel ministry has estimated a capacity increase of about 105.8 MnT in FY14 and about 118.2 MnT in FY17 mainly through Blast Furnace (BF) route. Generally for making 1 MT of steel around 0.7-0.9 MT of Coking Coal is required.
As India’s steel production will rise, its Coking Coal requirement will also increase. For now, Coking Coal requirement is around 60 MnT as current per steel production capacity. In addition, Working Group has estimated the demand to around 90 MnT by the end of 13th Plan.
Indian Coking coal mining has been ignored from a long time, despite of having around 18 BnT proved reserves (as per Ministry of coal), steel industry is getting only around 30 per cent to about 18 MnT coking coal. Indian coking coal production was 43 MnT in FY13.
Almost 90 per cent of Coking coal production of India is dominated by Coal India and it is focused to serve Power grids. Maximum low grade Coking coal used to be supplied to Power utilities by Coal India, owing to lack of suitable washing facility.
To meet the Indian Coking Coal demand, Indian government is pushing hard to develop such reserves and even thinking to demerge major Coking coal producer Bharat Coking Coal Limited (BCCL) from Coal India to support growing Steel Industry pace.
Market experts believe that Coal import will grow, so India should focus on developing infrastructure to support growth. More development is required on Port infrastructure and Railway Infrastructure.
Coking Coal Imports
India has imported 10.97 per cent CAGR Coking coal during FY 2009-2013. India’s Coking coal import grew from 21.1 MnT FY09 to 35.5 MnT FY13 and extending the forecasting line for FY 14 with it is estimated to import around 39.4 MnT.
Around 77.3 per cent Coking coal imports are from Australia, about 9.3 per cent is imported from USA and rest from other countries like south Africa, NewZealand, Mozambique etc.