India's coking coal imports dip m-o-m in Jul'24; near term looks bleak

• Imports from Russia surge over 60% m-o-m
  
  
• Volumes from Australia down 19% m-o-m
  
  
• Mongolia being tapped for alternate sourcing
  
  

India's coking coal imports in July 2024 edged down to 5.97 million tonnes (mnt) against 6.02 mnt seen in June 2024, as per provisional data maintained with BigMint. The imports have been down amid lower steel demand in the country. Thus, some traders holding cargo were going for reselling in the absence of active demand. Besides, monsoons in the country kept buyers away from major procurements during the month.

Imports from Australia down m-o-m

Imports from Australia dropped by 19% m-o-m in July to 2.93 mnt as against 3.6 mnt in June. Imports from Russia recorded a rise of 62% to 1.33 mnt as against 0.82 mnt in June. Imports from the US were recorded at 0.81 mnt, up 59% m-o-m.

SAIL imports drop: SAIL recorded the highest imports at 1.63 mnt in July, down 15% m-o-m as against 1.91 mnt in June. JSW Steel's imports increased by 43% on a monthly basis to 1.5 mnt followed by Tata Steel at 0.89 mnt (up 20%).

Dhamra Port received the highest imported cargo volumes of 1.16 mnt in July, up against 0.71 mnt in June. Import volumes at Paradip fell by 7% to 1.13 mnt in July followed by Haldia at 0.96 mnt.

India's near-total dependence on imports for meeting its coking coal requirements has prompted the government to diversify import sources in order to avoid over-reliance on certain countries. Of late, the government has taken active interest in importing coking coal from Mongolia. Coking coal is being imported by some leading domestic steel mills on a trial basis. The government is working out the logistical modalities for seamless imports from landlocked Mongolia in the near future.

Mongolia is a landlocked nation and shares borders with China and Russia. India will be seeking alternative routes to China, including tapping the Vladivostok-Chennai route, to secure coal. In May, Indian steel mills were exploring the possibilities of identifying a logistics company with the help of the Indian embassy in Mongolia to bring a trial cargo of hard coking coal to Russia's Vladivostok Port. There might be options of dividing the cargo between end-users.

Outlook

India's coking coal imports are likely to remain on the lower side in the near term on reduced infrastructure activities amid ongoing monsoons and pressure of steel imports. Additionally, a few primary players are learned to have planned maintenance schedules in August which may keep import inquiries on the lower side.