SAIL Chairman Amarendu Prakash told Mint on the sidelines of the Indian Steel Markets conference today that the company plans to bring in 3,00,000 tons of coking coal by the end of this quarter (July - September).
"This is a continuous thing; we are constantly buying from them. In the last quarter I think we bought 6 ships, which means 3 lakh tons," he added. Last quarter, the company imported three ships, each containing 75,000 tons of coking coal, and is in the process of finalizing the import of four more ships.
With this in view, the company plans to double the capacity of International Coal Ventures Private Limited's (ICVL) Benga coal mine in Mozambique through the SPV, a joint venture between the PSUs, the chairman added. Currently, ICVL has a capacity of 2 MTPA (million tons per year).
"At the moment, imports from Russia have proven to be much cheaper than coal imports from other countries," Prakash added when asked about the cost of imports from Russia compared to Australia. "Geographically we are trying to diversify our sources, we have long-term suppliers from Australia and now we have long-term suppliers from Russia," he added.
Russia and Türkiye record increase in imports
While SAIL continues to import its requirements from Russia, data from S&P Global Commodities at Sea show that India's imports of Russian coal between May 22 and July 23 fell to 5.6 million mt from 6.1 million mt in the same period a year earlier. In contrast, Russia and Türkiye recorded an increase in imports from Russia during the same period.
The company works with Australia, Indonesia and Mozambique to source coking coal. However, prices of premium hard coking coal (PHCC) from Australia have risen sharply due to limited supply as some mines have suspended operations. The problems have been compounded by Indian mills constantly bidding to stock up ahead of a post-monsoon demand surge.
Concerned about rising prices, Prakash said the increase in coking coal prices has a direct impact on the company's margins. Cheaper coal imports from Russia help provide that buffer for the steel giant.
Comments
No comment yet.