India: South African portside coal prices steady but GST uncertainty triggers caution among buyers

• GST hike and cess removal create confusion, sellers rush to liquidate 
• Domestic coal prices steady; sponge iron gains on improved demand

South African RB2 and RB3 thermal coal prices at Gangavaram remained stable w-o-w at INR 8,300/t and INR 7,200/t, respectively. It was heard that ports had limited stocks and sellers are keen to liquidate old material before the GST deadline of 22 September 2025, while buyers wait for fresh offers. Market sentiment is cautious, with uncertainty over the impact of GST changes keeping activity muted.

GST shift sparks confusion

The GST Council raised the rate on coal from 5% to 18% and removed the INR 400/t cess. This keeps the overall tax burden broadly unchanged, but the transition has unsettled trade. Sellers with stock are rushing to offload, while buyers prefer to wait for clarity under the new structure.

Domestic coal prices steady

Domestic coal prices stayed flat this week, with 5,000 GCV assessed at INR 5,700/t ex-Bilaspur and 4,500 GCV at INR 4,800/t. Lower grades may see marginal relief, while higher grades could turn costlier due to GST adjustments.

Portside inventories decline

India’s portside thermal coal inventories fell 5.4% w-o-w to 13 mnt in Week 35 from 13.78 mnt in Week 34, weighed down by slower arrivals.

Sponge iron market picks up

BigMint’s C-DRI index (ex-Rourkela) rose INR 450/t w-o-w to INR 26,050/t, supported by improved inquiries and positive sentiment from GST reforms. Raigarh led the gains, with other hubs also seeing stronger trade activity.

Outlook

With GST-driven changes and inventory pressure, the coal market remains in a wait-and-watch mode. The real impact will emerge in the coming months as new offers surface.