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India's coking coal imports seen rising to 35 mln T in 2013/14
May 22, 2013 / 1:56 PM / 5 years ago

India's coking coal imports seen rising to 35 mln T in 2013/14

* India to add 5-6 mln T steel-making capacity in 2013/14

* Capacity additions, utilisation to push up met coal imports

* Import demand may be 50-60 mln T by 2020 -Wood Mackenzie

By Malini Menon

NEW DELHI, May 22 (Reuters) - India’s metallurgical coal imports are likely to grow by 8.7 percent to 35 million tonnes in 2013/14 as additions to its steel-making capacity lift demand, four traders and a steelmaker said.

India, the world’s fourth-largest steel producer, is expected to add around 5 million to 6 million tonnes of steel-making capacity in this fiscal year to end-March, said an official at JSW Steel.

“In the coming years, coking coal imports will go up because of the new capacities that are coming up,” said the official at the country’s third-largest steelmaker, who did not wish to be identified citing company policy.

Imports in the last fiscal year covered about 40 percent of India’s total metallurgical, or coking, coal needs. Domestic coal reserves of 286 billion tonnes, fifth-largest in the world according to BP, mostly consist of thermal coal, which is used in power plants.

“I expect (coking coal) imports of 35 million tonnes this fiscal year,” a coal trader said, on condition of anonymity because he is not authorised to speak to the media.

India produced 49.35 million tonnes of metallurgical coal and imported 32.2 million tonnes in 2012/13, government data showed.

Steel Authority of India, which imports three-quarters of its coking coal, hopes to raise steel capacity to 18 million tonnes this fiscal year or next from 14 million currently, with its coal imports rising by 3 million tonnes to 13 million tonnes.

As for Tata Steel, “We do not expect any capacity addition before the last quarter of 2013/14,” said a company official, who did not wish to be named.

“Shortage of iron ore supply in India has probably pushed back some of the demand growth (for coal imports),” said Prakash Sharma, a senior coal markets analyst for APAC at energy research consultant Wood Mackenzie.

Iron ore output fell to about 167 million tonnes in 2012/13, after a clamp down on illegal mining led to mining bans in the top producing states of Goa and Karnataka.

“Longer-term (coking coal import) demand growth is still very, very robust for India. (It) could be 50-60 million tonnes by 2020,” Sharma said. (editing by Jane Baird)

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