- SECL’s FY25 coal output may fall short at 190 mnt against a 206 mnt target
- Limited rail connectivity, coastal infra hit dispatch efficiency
The All India Steel Conclave 2.0, organised on January 10-11, 2025, by the Chhattisgarh Steel Re-rollers Association, with BigMint as the Knowledge and Marketing Partner, brought together key industry stakeholders to discuss the evolving raw material needs of India’s steel industry. The session on “Evolution of Raw Material Requirement by 2030: Coal” highlighted critical insights on coal production, challenges, and outlooks.
SECL coal production targets
FY’25 goals and challenges: SECL (South Eastern Coalfields Limited) set a coal production target of 206 million tonnes (mnt) for FY’25. However, operational challenges may result in an output of 190 mnt, as shared by Mr. T.S. Behera, GM (Marketing & Sales), SECL.
Sectoral allocation: Of the total production, 20% (~38 mnt) is allocated to the non-power sector, including an estimated 5-6 mnt for the steel industry, while 80% (~152 mnt) goes to the power sector.
Coal production outlook and infrastructure bottlenecks
Peak capacity by FY’35: SECL’s coal production is expected to peak by FY’35, with a gradual decline anticipated thereafter.
Infrastructure challenges: Limited rail connectivity and inadequate coastal coal movement infrastructure continue to impede coal dispatch efficiency. Delays are exacerbated by shortages in rail rakes.
Coal imports and future demand
Thermal coal imports: India’s thermal coal imports are expected to stabilise as domestic availability improves. However, South African coal, a key input for steel production, remains subject to price volatility, as noted by Mr. Rajpal Singh Bhatia, AVP-Procurement, Agarwal Coal Corporation Pvt. Ltd.
Rising demand: Coal demand in India is projected to grow to 1.5 billion tonnes by 2030, placing additional pressure on domestic production and imports. South African coal prices have remained under pressure amidst steel price drops and increased domestic availability
Indian Railways role in coal transportation
Capacity expansion: Indian Railways is focused on surpassing the freight capacity of US Railways by 2030, according to Mr. Avadhesh Kumar Trivedi, Sr. DCM, South Eastern Central Railway (SECR). Over the past decade, annual track expansion has surged from 1,100 km to 5,300 km.
SECR achievements: SECR achieved 100% electrification by December 2024, enhancing operational efficiency.
New projects: The Rowghat Pariyojna, a 145-km railway line linking Dallirajhra to Jagdalpur, will reduce coal transportation turnaround times and improve dispatch operations.
Plans to address coal dispatch challenges
Wagon procurement: The government plans to procure 200,000 new wagons over the next five years to address rake shortages and reduce dispatch delays.
Enhanced infrastructure: These rail infrastructure enhancements are critical to meeting India’s rising coal demand and energy needs.
The session underscored the importance of addressing infrastructure challenges, optimising transportation networks, and ensuring a steady coal supply to sustain India’s ambitious economic and industrial growth targets.
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