Indian coking coal imports at risk of contraction

Indian coking coal imports moving through 12 key state-controlled ports only posted marginal year-on-year gains during April-November and were at risk of a further contraction as lower steel production hits demand.

India imported 37.2mn t in the first eight months of the 2019-20 fiscal year starting 1 April, up by just 1.95pc from April-November last year, according to data from the Indian Ports Association (IPA).

This was despite the recent consolidation of India's steel industry amid the acquisition of several bankrupt steel mills by the country's main steel producers. Indian steel output and coking coal demand in 2019 was expected to show much larger growth over the previous year, with imports potentially even overtaking volumes into China. But coking coal import volumes are now at risk of contracting because of weaker global steel prices that have caused a narrowing in the profit margins of steel producers.

India imported 57.5mn t of coking through state ports in 2018-19, but is now on pace for a drop to about 56mn t for 2019-20 or even less if the month-to-month downtrend in import volumes continues.

The IPA data do not include a breakdown of which countries exported coking coal to India. Only nine of the 12 ports covered by the IPA data received coking coal shipments during April-November.

The port of Kolkata handled the largest share of coking coal imports during the period at 11.12mn t, down by 9.2pc from the previous year. This included 9.75mn t received at Haldia and 1.37mn t arriving at the Kolkata Dock System.

Coking coal imports at Paradip were 7.89mn t during April-November, down by 5.1pc against last year. Imports at Mormugao in Goa state increased by 31pc to 5.26mn t, while volumes at the port of Vizag rose by 17pc to 5.05mn t.

Imports at Chidambaranar, Tamil Nadu were 4.03mn t, while volumes at Mumbai and New Mangalore were 2.06mn t and 528,000t respectively.

The port of Ennore received 602,000t of coking coal, while Deendayal imported 638,000t. But the ports of Chennai, Cochin and Jawaharla Nehru did not take any coking coal imports during April-November.

By Greg Holt