India’s coal imports turn steel-centric as metallurgical coal demand rises

India’s Coal Imports Shift Towards Steel Production as Metallurgical Coal Demand Rises

According to a report by the Multi Commodity Exchange (MCX), India’s coal import basket is becoming increasingly focused on steel production, with a significant rise in metallurgical coal imports in the financial year 2025-26. Despite a relatively stable overall coal import figure of 244.2 million tonnes, the composition of imports has undergone a notable shift.

Coking coal imports increased by 12.4% year-on-year to 63.7 million tonnes, while pulverised coal injection (PCI) imports rose by 6.2% to 20.9 million tonnes. As a result, India’s total metallurgical coal imports reached 84.5 million tonnes in 2025-26, representing a 10.4% increase from the previous year. This growth is attributed to continued demand from the country’s steel sector.

In contrast, non-coking coal imports declined by 5.5% year-on-year to 159.7 million tonnes, reflecting improved domestic coal availability and reduced dependence on imported thermal coal. The report suggests that India’s import basket is steadily shifting away from fuels used primarily by the power sector towards steel-linked raw materials, making future coal import trends more sensitive to steel production rather than electricity demand.

The changing pattern of coal imports is also influencing India’s supplier mix. Russia has emerged as one of India’s fastest-growing coal suppliers, with shipments increasing by 13.1% year-on-year to 32 million tonnes. Australian coal exports to India also rose by 9.3% to 43 million tonnes, with coking coal shipments increasing by 13.4% to 34.3 million tonnes.

The report notes that India’s coal procurement strategy is becoming more diversified and steel-centric, driven by improving domestic thermal coal availability and the expanding steel industry’s continued dependence on imported metallurgical coal. As the country’s steel sector continues to grow, it is likely that metallurgical coal imports will remain a key component of India’s coal import basket.

Article and image source: russiaherald.com