Rio Tinto Ltd, the Anglo-Australian mining firm, is eyeing a
share of the rapidly growing Indian thermal coal market.
“India's coal imports are projected to touch about 200
million tonnes over next few years. We want to be part of that supply,” said Dr
Nik Senapati, Managing Director, Rio Tinto India.
“Last year, we sold
some small quantity of thermal coal to India through a trader. Now we want to
get into Indian thermal coal market directly,” Dr Senapati added.
Rio Tinto produces high grade thermal coal from its deposits
in Eastern Australia. In a bid to make it competitive with those from
Indonesia, Rio Tinto proposes to ship the commodity in large (cape size) vessels
to India to reduce costs.
India currently imports a bulk of its thermal coal from
Indonesia, while it relies heavily on Australian coking coal to produce steel.
Last year, Rio Tinto supplied three million tonnes of coking
coal to Indian steel companies such as JSW Steel and Tata Steel.
The domestic thermal coal output in India has been constrained
by environmental regulations and is insufficient to meet the rising demand. India's
coal import stood at 70 million tonnes in 2010-11. In the current fiscal, the
shortfall in coal demand-supply has been pegged at 142 million tonnes, which
will be met through imports.
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