India’s coal imports from Russia shot up to a record high of 2.3 million tonnes (mnt) in August 2022, as per Coalmint vessel data.
Out of total shipments, thermal coal imports had a predominant share of 80%, while coking coal imports comprised 12%.
A total of 1.8 mnt of Russian thermal coal arrived at Indian ports as domestic supply crunch for the non-power sector and competitive prices pushed buyers to seize the opportunity of booking Russian cargoes.
High-CV Russian 6000 kcal/kg NAR grade coal prices were lower by $40/t compared to mid-CV South African RB2 (5500 kcal/kg NAR) coal in August.
India’s total thermal coal imports, however, fell to 15.4 mnt in August, down by 19% m-o-m, CoalMint data showed.
A plethora of industries including sponge iron, power and cement began using Russian coal owing to cheap availability, high calorific value and lower sulphur content. The major buyers in August were JSW Energy, Ultratech Cement, Rashmi Group, and Rawmet Commodity.
Cost-competitive Russian coal continues to find favour with the sponge iron units located in the eastern and southern regions of the country, while captive power producers are procuring Russian coal for blending amid high Indonesian coal prices.
Coking coal imports down 60%
Meanwhile, India’s coking coal imports from Russia fell sharply by 58% m-o-m to 150,000 t in August as Indian steel mills shied away from bookings amid fear of sanctions.
Coking coal buyers in August were mostly traders, Indo German International Pvt Ltd, Visa Steel and Kirloskar Ferrous.
PCI imports fall 65%
India’s PCI coal imports from Russia fell sharply by 66% to 200,000 t in August with the key buyers being JSW Steel, other importers and the mini steel plants.
Outlook
India’s thermal coal imports from Russia may rise in September and October with robust domestic demand. However, in the last two months of 2022, imports may decline with the Russian winter impeding mining activities and coal transportation.
Russian coking coal imports may fall in the coming months because some integrated steel mills might continue to avoid booking Russian cargoes. However, the price differential with Australian coal will be a prime factor. PCI coal imports may remain rangebound, with weather-related constraints obstructing supplies from Russia and elsewhere.
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