Steel Authority of India Ltd (SAIL), the country's largest state-owned steel producer, is actively pursuing increased purchases of coking coal from Russia for its comparatively lower prices, local media reported.
SAIL is expecting four shipments, each with a capacity of 75,000 tonnes, in the final quarter ending December, as part of their strategy to optimize costs, said Chairman Amarendu Prakash on November 6.
Coking coal, a crucial raw material for steelmaking, has faced a shortage in supply, leading SAIL to explore alternative sources.
Currently, more than half of India's annual coking coal imports of 70 million tonnes are obtained from Australia. However, the high prices of Australian coking coal have been squeezing profit margins for steel companies, prompting SAIL to explore price-competitive Russian suppliers.
SAIL has received eight shipments from Russia since April, and plans to raise prices of various grades of steel amidst rising import costs.
The company is also considering doubling the capacity of the Benga coal mine in Mozambique through its subsidiary, International Coal Ventures Private Limited (ICVL), to secure a more sustainable supply of coking coal.
ICVL boasts an annual capacity of 2 million tonnes at present.
(Writing by Riley Liang Editing by Harry Huo)
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