As a result of decreased supply from Australia and increased prices, India is planning to expand its imports of coking coal from Russia, according to a report that Reuters published on Tuesday. The article cited government officials and industry leaders. Coking coal is an essential raw resource when it comes to producing steel. It has been reported that Indian steel factories, the world’s second-largest raw steel producers, have been experiencing difficulties in their supplies from Australia. Australia is typically responsible for more than half of India’s annual coking coal imports, which amount to over 70 million tonnes.
The price of Australian coking coal increased by fifty per cent in October, reaching more than three hundred fifty dollars per metric tonne. This increase was brought about by several factors, including disruptions in technical maintenance, deliveries from Queensland that were lower than usual, and slower operation of the railway network.
At the beginning of November, the Australian side reportedly assured India that the continuity of coal shipments would be maintained, as reported by sources within the Indian government. Nevertheless, the government of India is working towards the goal of diversifying the country’s import basket.
According to sources who spoke with Reuters, Russian coking coal is already lower than Australian coal, and some Russian suppliers are eager to keep the price down even further. One government official observed that “discounts and payments in rupees have helped (Indian) enterprises perceive Russia as an alternative source to obtain goods and services.”
Steel makers in India who are dependent on government assistance, such as the Steel Authority of India Limited (SAIL) and Rashtriya Ispat Nigam, have favoured settling payments for Russian coking coal in rupees. According to a different source within the Indian government, “The currency (rupee) is a factor that is favourable for these enterprises.”
An earlier statement by the chairman of SAIL indicated that the business anticipates receiving four shipments of Russian coking coal by the end of the year, with each shipment containing 75,000 tonnes.
