*Imports from Russia jump two-fold in April
*SAIL remains largest importer followed by JSW, Tata Steel
India’s coking coal imports in April 2024 fell by 12% to 4.59 mnt as against 5.22 mnt in March, as per BigMint data. However, imports remained almost stable y-o-y at 4.59 mnt in April compared to 4.57 mnt in April 2023.
India’s coking coal imports dropped by 12% m-o-m primarily attributed to price volatility, which prompted buyers to adopt a cautious approach. Indian coking coal buyers had sufficient inventory as demand for coking coal remained subdued, resulting in a drop in imports.
Indian users are trying to explore alternatives for coking coal to decrease reliance on Australian coal. The void left by shrinking imports from Australia has been filled by higher shipments from Russia, Canada. Imports from Russia has picked up significantly due to cost benefit. SAIL imported eight shipments of coking coal, each consisting of 75,000 t, totaling 600,000 t, from Russia during the initial two quarters of FY’24.
The shift in India’s coking coal import patterns can be attributed to the significant increase in Australian PHCC prices following sanctions on Russia. This spike in prices, along with the volatile nature of premium coking coal prices, has made cost-competitive Russian shipments a preferred option for buyers. Notably, despite the higher freight costs, import volumes from the Atlantic market have risen considerably due to the unusual surge in Australian PHCC prices.
BigMint holds the view that Indian blast furnace (BF) steel producers are significantly impacted by the volatility in the coking coal market. It is anticipated that BF-based steel mills are actively engaged in experimenting with different coal blends for coke preparation in response to these market fluctuations.
India’s imports from Australia stood at 2.36 mnt in April, down by 27% m-o-m as against 3.23 mnt in March which can attributed to the mismatch between bids and offers. India’s imports from the USA dropped 11% m-o-m to 0.54 mnt in 2024 as against 0.61 mnt in March.
Shipments from Russia doubled in April 2024 to 0.78 mnt as against 0.35 mnt in March. Cost benefit is the main reason for the rise in imports of coking coal from Russia. Shipments from Canada increased by 28% in April to 0.27 mnt as against 0.21 mnt in March. Coking coal deliveries from Mozambique dropped 17% to 0.19 mnt in April 2024.
SAIL recorded the highest imports at 1.28 mnt in April, down 12% m-o-m as against 1.46 mnt in March. JSW Steel;s imports increased by 8% m-o-m at 1.13 mnt followed by Tata Steel at 0.61 mnt (down 54%). Bhushan Power’s imports surged significantly to 0.18 mnt in April whereas NMDC imported 0.16 mnt in the month under review.
Paradip port received the highest imported cargo volumes of 0.87 mnt in April, volumes at Vizag increased by 58% at 0.87 mnt. Haldia and Jaigarh ports received 0.61 mnt and 0.62 mnt, respectively. Dharma port received by 41% to 0.62 mnt.
Outlook
In the coming months, India’s coking coal imports may remain subdued due to weaker steel demand amid ongoing elections in the country. Additionally, the Indian government is endeavouring to bolster domestic coking coal production through the implementation of various policies and is focusing on diversifying coking coal imports. However, logistical challenges compounded by the persistent threat of sanctions, may disrupt supplies and potentially impact Indian buyers.
