Steel Makers Importing More Coal
News: Indian steel makers have started importing coal from far off countries such as Canada in addition to imports from its usual suppliers such as Australia and Indonesia, reports the Economic Times. The increasing imports come in the wake of the scandals and red tapism affecting the domestic coal mining industry, the report stated. Westshore Terminals which is Canada's major coal export terminal shipped 400,000 tonnes of coal to India in 2013, according to Denis Horgan, vice-president and general manager at Westshore. Of the 400,000 tonnes, 240,000 tonnes was bought by Indian company JSW Steel and the remaining was bought by Singapore-based coal trading firm Lotus Resources for Indian producers, Horgan added. Citing JSW steel, the report added that it is cost effective to import some grades of coal from North America and blend them with other grades.
BMI View: Despite ambitious plans by the government to boost domestic coal production in India which has the world's fifth largest coal reserves at 286bn tonnes (bnt), we expect India to become increasingly reliant on coal imports over the coming years. A combination of obstacles, with regulatory and bureaucratic hurdles the most pertinent, will continue to sap growth in the coal sector.