Steel Authority of India Limited (SAIL), the state-owned Maharatna steel making company, is looking at developing new destinations and vendors for sourcing coking coal to reduce dependence on select few countries, chairman Anil Kumar Chaudhary stated in a recent interview.
Raw material security holds significance for the steelmaker as it plans to more than double its annual capacity to 50 mn t by 2030. As yet, however, SAIL and other Indian steelmakers depend heavily on imported coking coal apart from some domestic sourcing.
Currently in India, about 80% of coking coal consumption is being imported. Coal quality has always been a major concern because of high ash and moisture content, coupled with meager reserves and production.
Although the Indian government has now commercialized coal mining, no steel company has shown interest in bidding for 4 coking coal blocks out of the total 38 mines put on auction for commercial mining, as they have concerns about fuel quality and high capital cost.
CoalMint’s statistical data reveals that India imported 57.2 million tonnes (mn t) of coking coal in FY20 — worth over INR 735 billion. Out of this, 42.1 mn t was imported solely from Australia, and the remaining from Canada, USA, Russia and Mozambique.
According to SAIL’s official data, during FY20, only about 1.53 mn t of coking coal requirement was catered from captive and indigenous sources like Coal India Limited, while the balance 13.70 mn t was met through imports.
Contrarily, SAIL meets its entire iron ore requirements from captive sources. During FY20, the company’s captive mines produced about 29.3 mn t of iron ore. SAIL has five integrated steel plants and over 20 captive mines spread across Jharkhand, Odisha, Chhattisgarh and West Bengal.
Chairman Mr. Chaudhary further said that SAIL is part of a joint venture International Coal Ventures Limited (ICVL) along with PSUs like RINL, NMDC, CIL and NTPC who are partners in the JV.
Aimed primarily at acquiring overseas mining assets, ICVL has acquired coal mines and assets in Mozambique with reserves of more than 500 mn t.
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