Domestic thermal coal supplies to Indian cement makers rose in January, both year on year and month on month, as producers expanded coal consumption to benefit from its cost advantage over petroleum coke.
Cement makers received 950,000t of domestic coal in January, up by 4pc from a year earlier, India's coal ministry data show. Receipts in April 2025-January 2026 — the first ten months of India's April 2025-March 2026 fiscal year — rose 22pc on the year to 8.23mn t. January receipts rose by 10.5pc from 860,000t in December 2025, partly supported by a seasonal uptick in cement output and demand.
Leading Indian cement makers reported higher year-on-year sales in October-December 2025, resulting in increased fuel consumption. A cut in cement taxes may have supported sales. India — the world's second-largest cement producer after China — reduced the goods and services tax (GST) on cement from 28pc to 18pc in September 2025 to boost demand.
Coal use also increased after the removal of a 400 rupees/t ($4.41/t) levy on coal from September 2025. Higher domestic coal availability has enabled cement plants to increase the coal's share in their fuel mix. Plants can switch between coal and coke depending on cost conditions.
Firmness in cfr prices and offers of seaborne high-sulphur coke also have prompted some cement plants to lift domestic coal intake, although most producers still need to blend coke in certain ratios to use local coal effectively. The Argus-assessed index for the delivered India price of 6.5pc sulphur coke was last assessed at $125/t on 18 February, well above the average of $117.625/t in January.
"We have started using a good amount of domestic coal in our plants and this has helped us offset the impact of the rise in coke prices," Jayakumar Krishnaswamy, managing director at leading cement maker Nuvoco Vistas told investors in January. It cut its coke use to 41pc in October-December 2025, from 48pc in the corresponding quarter of 2024.
A weakening of the rupee against the dollar may also be triggering a preference for domestic coal compared with imported fuel. The rupee averaged at almost Rs90.73 to the dollar in January, compared with about Rs90 in December 2025.
Indian coal supplies to non-power consumers, such as cement plants and steel mills, increased in the first ten months of the 2025-26 fiscal because of higher availability and lower demand from coal-fired power plants.
Higher domestic coal supply to cement plants and a partial replacement of coke usage partly limited India's overall appetite for imported coke in 2025. Indian cement makers imported 10.67mn t of coke from origins including US and Saudi Arabia in 2025, down slightly from 10.83mn t in the year earlier, according to data from shipbroker Interocean.
