India Eyes Russian Steelmaking Coal Assets
Indian state-controlled steelmakers are considering buying coking coal assets in Russia to boost the supply of the raw material that India designated as a critical and strategic mineral early this year.
Officials from Steel Authority of India (SAIL) and NMDC Ltd visited Russia last month and held talks with Russian government and industry representatives to explore opportunities to buy steelmaking assets in Russia, Indian sources with knowledge of the development told Reuters on Tuesday.
India receives about half of its steel-making coal supply from Australia, with Russia and the United States also holding significant shares of Indian supply.
Now India is looking to ensure additional supply for its steelmaking industry from Russia.
“Both SAIL and NMDC are exploring sourcing of raw materials and are in talks with Russia,” one of the sources told Reuters.
India in January designated coking coal as a Critical and Strategic Mineral under the Mines and Minerals (Development and Regulation) Act, as part of ongoing structural reforms in the mining sector.
The classification of coking coal as a critical mineral recognizes “the strategic role of coking coal in ensuring mineral security and meeting the requirements of the domestic steel sector,” the Indian federal government said at the time.
While India has an estimated 37.37 billion tons of domestic coking coal resources, the world’s second-biggest producer of crude steel after China currently meets about 95% of its coking coal demand through imports.
With the reform, India expects to reduce its huge import dependence, strengthen supply-chain resilience for the steel sector, and support the objectives of the National Steel Policy. The reform is also expected to promote private investment in exploration and the adoption of advanced mining technologies.
India’s steelmaking industry is currently grappling with a surge in gas and LPG prices amid the Middle East crisis, steel analysts at the Institute for Energy Economics and Financial Analysis (IEEFA) said in April.
By Michael Kern for Oilprice.com
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