The Association of producers and suppliers of metallurgical coal has raised concerns about the surge in the import of metallurgical coke at prices lower than the domestic production cost. Metallurgical coal, a key component for producing high-quality coke, has seen an influx of over 3.6 million tonnes of cheap imports during the fiscal year 2022-23. The prevailing import rate stands at USD 395 per tonne, while the domestic production cost for met coke is approximately USD 460 per tonne.
This pricing gap has posed a significant challenge to India’s merchant met coke sector. The Indian Metallurgical Coke Manufacturers’ Association (IMCOM) is urging the government to intervene and address the issue. IMCOM proposes the imposition of quantitative restrictions on overseas met coke imports to maintain a sustainable ecosystem within the industry. Such restrictions could potentially reduce the influx of cheaper met coke from 3.6 million tonnes to around 2.6 million tonnes.
Dipak Agarwalla, President of IMCOM, emphasized the need for these measures to ensure the industry’s sustainability. The surge in cheap overseas met coke flooding Indian markets has led local traders to opt for international purchases to maximize their margins. This trend has not only triggered an unemployment crisis within the Indian met coke industry but has also hindered operations from reaching full capacity, exacerbating economic challenges.
The stark disparity between inexpensive imports and increasing domestic production costs raises concerns about the long-term sustainability of the local ecosystem, according to IMCOM. The association highlights the urgency of government intervention to address the pricing gap and prevent further damage to the Indian met coke industry.