The Russia-Ukraine war and the subsequent rise in global coking coal prices forced Indian steel mills to reduce their dependency on Australian imports while, at the same time, diversifying coking coal purchases from other countries such as the US, Indonesia, and Mozambique.
Qty in mnt
India’s coking coal imports in 2022 remained largely stable at 55.9 million tonnes (mnt). Imports from Australia fell by 15% y-o-y to 37.8 mnt, as per CoalMint’s vessel data. The decline came amidst supply disruptions due to La Nina phenomenon. More-than-expected rainfall and flooding in Australia affected coal mining and transportation activities.
Also, the sanctions on Russia imposed by Europe resulted in latter buying more coal from alternative sources like Australia, which kept Australian coal prices elevated for most of the year. Thus, Indian mills had to diversify their purchases from other origins.
Coking coal shipments from the US surged 123% on the year, while imports from Mozambique and Russia rose by 65% and 141%, respectively. Russia focused on the Asian market post sanctions and targeted the key steel producing nations of India and China.
India’s crude steel production rose 6% to around 124 mnt in 2022 as against 117.6 mnt in 2021 despite intermittent production cuts due to the 15% export duty imposed on finished steel in late-May last year.
SAIL top importers
Qty in mnt
PSU steel major SAIL imported the highest quantity of cokign coal in 2022 at 15.91 mnt, up 15% y-o-y, followed by JSW Steel. SAIL’s imports in December increased by 75% m-o-m to 1.38 mnt, followed by JSW Steel’s at 1.24 mnt, up 10% m-o-m.
Paradip Port receives highest volumes
Qty in mnt
In 2022, Paradip Port received the highest shipments at 9.81 mnt. However, volumes fell by 7% y-o-y. Shipments to Jaigarh and Haldia ports increased y-o-y to 5.05 mnt and 3.7 mnt, respectively.
PCI, met coke imports
India’s PCI imports increased by 7% y-o-y to 13.37 mnt amid cheaper availability of PCI coal from Russia. Shipments from Russia surged 169% y-o-y in 2022.
Met coke imports rose by 36% in 2022 to 3.36 mnt due to cheaper imports from China. The leading exporters were Poland and China. ArcelorMittal Nippon Steel India (AM/NS India) and JSW Steel were the top buyers.
Outlook
With the India-Australia FTA (free trade agreement) in place, India’s coking coal imports from Australia are expected to increase in 2023. However, in case there is cheaper availability of met coke from China and Indonesia, India’s overall coking coal imports may not rise markedly.
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