Responding to the steel industry plea to increase the domestic availability of coking coal, India’s Ministry of Coal has maintained that coking coal supplies could not be ramped up in the short term and would at best hit the 71 million mt target by 2020, a ministry official said on Thursday, September 8.
The official said that, with current coking coal production pegged at 54 million mt per year, geological challenges and the limitations of metallurgical grade coal reserves in the country, it will be extremely challenging to meet higher demands from domestic sources as sought by Indian steel producers.
Supporting the domestic steel producers, the Ministry of Steel has been in communication with the Ministry of Coal seeking higher domestic production of coking coal, thereby reducing the import dependency of domestic steel mills, the coal ministry official said.
Supporting higher domestic availability, the steel ministry pointed out that in the current year coking coal imports are forecast to touch 50 million mt, against 43 million mt shipped during 2015-16, while they are projected to reach 180 million mt by 2025 if India is to achieve total steel production of 300 million mt, the official said.
However, given the inability to increase domestic coking coal production, both the steel and coal ministries have agreed to work towards scrapping the 2.5 percent import duty on coking coal to partially offset the higher input costs of Indian steel mills, the official added.