India’s coking coal imports at 10-year high, Russia among top three suppliers with 12% market share

India continues to be among top coking coal importers globally, a key feedstock in steel-making.
India's coking coal imports have reached a 10-year high, with shipments totaling 58 million tonnes (mt) in FY24, driven by strong demand from steel mills. This marks a 7% year-on-year (y-o-y) increase from 54.3 mt in FY23 and a more than 20% rise over a decade. Notably, supplies from Russia hit multi-year highs of 6.4 mt in FY24, a 200% surge y-o-y from 2.3 mt in FY23, and a 300% increase from 1.6 mt in FY19, according to data from various ministries and trade sources.

India remains one of the world's top coking coal importers, a critical input in steel production. Over the past decade, segment imports have fluctuated between 47 mt and 54 mt, as reported by businessline. In FY24, Australia maintained its position as the largest supplier, providing 59% or 34.2 mt of total shipments, despite a decline in its market share. Russia and the USA have expanded their presence, with Russia now holding a 12% share and the USA 14%, supplying 8.4 mt.

Six years ago, Australia dominated with 81% of shipments, while Russia had a 3% share and the USA 8%, as per consultancy firm BigMint. The Cabinet's approval in 2021 of a Memorandum of Understanding (MoU) between India and Russia on coking coal cooperation has significantly boosted supplies. Price volatility of Australian coal and higher discounts from Russia, alongside alternative sources from the USA, have reshaped market dynamics. By FY23, Australian supplies had a 70% market share, the USA 12.5%, and Russia 5%.

Throughout FY24, Russia offered consistent discounts of 20-25%, prompting Indian mills to recalibrate their furnaces to accommodate higher ash content coal from Russia. Consequently, Russia has overtaken Mozambique and Canada to become the third-largest supplier of this raw material.

"Steel demand and production have remained robust in India, defying the global slowdown. Demand for steel has surged, leading to a record increase in sponge iron production," a government source explained.

India's sponge iron production rose 20% y-o-y to 52 mt in FY24 from 43 mt in FY23, supported by production through the induction furnace route. Falling imported coal prices, down 48% y-o-y to $109/t CNF Gangavaram in FY24 from $209/t in FY23, spurred a 62% increase in thermal coal imports for the sponge iron sector, according to BigMint.

India's crude steel production also saw significant growth, increasing by approximately 14% to 143 mt in FY24 from 127 mt in the previous year. This growth was largely driven by a sharp rise in production via induction furnaces, which grew 25% y-o-y to 50 mt, and a 12% growth in electric arc furnace (EAF) production, reaching 31 mt.