Aimed at diversifying the import regions to check interruptions in supply, the major coal consumer in India are now looking at the USA and Canada markets for importing the fuel in order to ensure adequacy in coal supply in respect to both—Coking and Non Coking Coal.
The last supply disruption in Australia aftermath the Debbie cyclone had put the coal users onto their heels, inciting them to explore alternate markets for ensuring continuity in coal supply.
In the pursuit of alternate coal import market exploration, USA and Canada have appeared onto the horizon due to the abundance of the fuel in those regions.
Indian users need high quality Thermal Coal as well as Coking Coal. Although, imports from USA and Canada come into India, but the quantities are small compared to the imports from other regions, such as Indonesia, South Africa and Canada.
In the recent meeting between India’s Prime Minister and USA’s President, the latter had expressed his desire to export clean coal( or washed coal) to India. Subsequently, officials of some coal consuming companies were asked to hold talks with American coal suppliers for striking deals. The Indian Steel Minister and the Chairman of SAIL will travel to Canada to hold discussions in the implied context with Teck Resources. Canada had already offered coal mines and supplies in 2014, and the prospective importers in India have been studying the various offers, and talking with the suppliers in that country since then.
Source: CoalMint Research
Although, concerns for importing coal from USA are gradually gaining steam in India, the endemic issue of high transportation costs is retarding the negotiations.
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