State-backed consortia to import coking coal is being planned by the government: Report

State-backed consortia to import coking coal is being planned by the government: Report

State-backed consortia to import coking coal is being planned by the government: Report

Major Indian steel producers have petitioned the government to assist expand supplies of the essential raw material for steelmaking, coking coal, because of the high cost and limited availability of the commodity.

According to two government sources, India intends to organize a group of state-owned businesses to enable the import of coking coal, which would assist local steel producers in addressing the scarcity.

Major Indian steel producers have petitioned the government to assist expand supplies of the essential raw material for steelmaking, coking coal, because of the high cost and limited availability of the commodity.

Approximately 85% of the coking coal used by Indian steel industries each year—roughly 70 million metric tonnes—is imported.

India, which produces the second-most crude steel globally, is facing difficulties in its steel mills due to the unreliability of Australian coking coal supplies, which make up over half of India's yearly imports.

India buys coking coal from other nations, such as the United States, Indonesia, and Canada, in addition to Australia.

According to sources, the group of government-backed businesses would facilitate the import of coking for steel industries by connecting them with suppliers across borders, settling trade agreements' conditions and pricing, and eventually selling the imported raw material to nearby steel mills.

Because they are not permitted to communicate with the media, sources who have firsthand knowledge of the situation did not want to be named. He made no mention of any potential participating firms.

The group will also think about expanding the kind of coking coal that India buys.

One of the insiders said, "The idea is to look beyond Australia to get the best price along with diversify the import basket."

An email requesting comment was not immediately answered by the federal steel ministry.

Although Australia promised India a steady supply of coking coal in November, there is already a shortage.

According to sources, India would import extra coking coal from Russia to make up for irregular supply from Australia. He said that Russian goods are less expensive than Australian freight, which is another benefit of purchasing from Moscow.

According to reports, the government will shortly officially start discussions with Mongolia for the procurement of coking coal, even before the consortium takes shape.

According to reports, Mongolia, which borders China and Russia and has an abundance of natural resources, has not yet discovered a practical way to ship raw materials to India.