India: Washed coal prices rise on supply constraints, higher production costs

• Washeries struggle to secure consistent quality feedstock 
• Domestic coal gains increase washed coal replacement costs

India’s washed coal prices strengthened further on 29 July 2026, supported by tight availability of preferred ROM coal, weak dispatches from SECL, and rising production costs. Market participants said washeries continued to face difficulties in procuring the desired quality and quantity of raw material, resulting in slower production. In addition, higher logistics expenses, electricity charges, and increasing plant maintenance costs further elevated production costs, lending support to rising washed coal offers.

BigMint assessed 38% FC (5,000 GCV) washed coal at INR 6,750/t FOR Raipur as on 29 July, up INR 200/t w-o-w and INR 500/t higher than INR 6,150/t recorded on 1 July. Market participants attributed the steady price rise to constrained production rather than stronger speculative activity, as limited availability of quality ROM coal continued to restrict washed coal output.

The firmness in washed coal prices also tracked the increase in domestic non-coking coal prices. BigMint assessed 5,000 GCV coal at INR 5,700/t ex-works Bilaspur as on 28 July, up INR 150/t w-o-w, while 4,500 GCV coal stood at INR 4,300/t, up INR 50/t w-o-w. Higher domestic coal prices raised replacement costs for washeries, providing additional support to washed coal prices.

Supply-side constraints were also reflected in SECL’s July spot e-auctions, where selected mine-grade combinations continued to attract healthy premiums. During the 25 July auction, Amadand OC G10 fetched a premium of 140.5%, while Chhal OC G11 achieved a 20% premium, indicating sustained competition for coal from preferred mines. Market participants said continued competition for quality ROM coal from selected mines further constrained feedstock availability for washeries.

Looking ahead, market participants expect washed coal prices to remain firm in the near term as long as preferred ROM coal availability remains tight and SECL dispatches stay slow. However, any improvement in mine dispatches or raw material availability could ease production constraints and stabilise prices.