- Hot metal output up 2.5%; coking coal imports rise 11.9%
- PCI cargo classifications complicate import comparisons
India’s steel demand expanded faster than domestic production during April-September 2026, supporting continued requirements for steelmaking raw materials.
Recorded coking coal and met coke imports increased, while available domestic production figures show broadly flat national coking coal output through August. Meanwhile, a sharp reported contraction in PCI imports requires caution because shipping records sometimes classify these cargoes as coking or non-coking coal.
The underlying demand signal is clearer: higher hot metal production supports blast furnace input requirements, although procurement also depends on inventories, domestic availability and operating practices.
Demand growth creates scope for higher domestic output
Finished steel consumption increased by 5.9 mnt, against a 3 mnt increase in production. India remained a net finished steel importer, with imports exceeding exports by approximately 0.59 mnt.
Stronger consumption creates an opportunity for domestic mills to increase production and raw material purchases.
Hot metal provides the clearer demand signal
Hot metal output is more directly relevant to blast-furnace coke and PCI requirements than aggregate crude steel production. Electric steelmaking uses different combinations of scrap, sponge iron and energy inputs.
The top seven producers accounted for approximately 93% of national hot metal output, concentrating blast-furnace requirements among major integrated mills.
Their production schedules, coke-making operations and inventories therefore remain central to metallurgical coal procurement. Higher output supports greater requirements, but does not imply an identical increase in imports.
Domestic coking coal production remains subdued
National coking coal production edged down during April-August. Lower CIL output was partly offset by growth among other producers.
This indicates limited expansion in domestic raw coking coal availability during the first five months of the financial year. It provides context for continued overseas procurement, although it cannot independently explain the increase in recorded imports.
Raw production also differs from washed coal available for steelmaking. Washing recovery, ash content and blend suitability determine its practical contribution to coke-making requirements.
Import growth requires classification checks
Recorded coking coal arrivals increased by 3.9 mnt to 36.8 mnt, outpacing hot metal growth. Inventory replenishment, domestic availability and purchasing schedules could contribute, but PCI cargoes recorded as coking coal may also inflate the apparent increase.
Recorded PCI imports fell by 7 mnt. This somewhat lessened the increases in coking coal and met coke, reducing their combined recorded volume by 2.3 mnt.
Reclassification between PCI and coking coal changes individual categories without changing their combined total. Reclassification into non-coking coal can reduce the reported steelmaking aggregate even when the cargo serves steel production.
The figures therefore cannot establish a corresponding decline in PCI consumption or a fundamental shift towards coke.
Met coke imports increased by 0.8 mnt to 2.7 mnt, indicating stronger purchases of processed coke.
September procurement remains uneven
September’s recorded coking coal imports reached 5.9 mnt, down 4.8% y-o-y but up 11.3% from August. PCI arrivals stood at 0.6 mnt, while met coke imports reached 0.3 mnt.
Within 2026, recorded coking arrivals eased from 18.8 mnt in April-June to 18 mnt in July-September. Met coke increased from 1.2 mnt to 1.5 mnt. These movements warrant monitoring alongside the classification caveat.
SAIL-BCCL agreement strengthens domestic pipeline
SAIL and BCCL signed an MoU on 25 September to jointly develop SAIL’s Indikatta Ramnagore and BCCL’s East of Damagoria, or Kalyaneshwari, blocks in West Bengal.
BCCL disclosures identify a planned joint opencast operation of 4 mnt annually and approximately 79.21mnt of mineable reserves in Kalyaneshwari. Coordinated development addresses insufficient overburden dumping space; the project report had received BCCL and CIL board approvals.
This offers future supply potential. Its contribution will depend on development timelines, washing recovery and coal suitability. The signing announcement did not specify commissioning dates.
BigMint assessment
Expanding steel demand and higher hot metal output support continued metallurgical coal requirements, while subdued domestic production keeps overseas sourcing important.
Future imports will depend on mill utilisation, inventories, delivered costs and domestic supply. Shipping classifications must be reconciled before the reported PCI contraction can be interpreted as a change in steelmakers’ fuel choices.
Leave a Reply