The domestic coal production sector remains upbeat after a a record-breaking coal production of 777 million Ton (MT) in 2021-22. The total domestic coal production in 2022-23, as on May 31, 2022 is 137.85 MT, which is 28.6% more as compared to the production of 104.83 MT in the same period of last year. This trend is being maintained in June 2022 as well. The coal production by Coal India Ltd (CIL) is 28% more than the production in the same period of the previous year (as on June 16, 2022). Domestic coal production target for the current financial year is 911 MT which is 17.2% more than the previous year.
The coal imports for blending by the Domestic Coal Based (DCB) power plants have dropped to 8.11MT in the year 2021-22 which has been the lowest coal import in the last eight years.
In another major announcement, the Indian coal ministry has stated that the country's domestic raw coking coal output may touch 140 million tonnes (MT) by 2030. This will be a major development for the country’s iron and steel industry as coking coal is an important input.
India has produced 51.7 million Ton (MT) raw coking coal during the financial year 2021-22 which is 15 % more as compared to 44.8 MT during FY21. Domestic raw coking coal production continues to witness an increasing trend in the current fiscal as well with production of 8.3 MT, as per the figures up to May 2022, which is 20% more compared to 6.9 MT during the same period of the previous year.Coal India Ltd. (CIL) is planning to set up and operationalise nine more new washeries with a capacity of 30 MTPA. With the setting up of new washeries, CIL will be able to supply about 15 MT of washed coking coal to the steel sector, thereby reducing import of coking coal.
To enhance raw coking coal production, the government has auctioned 10 coking coal blocks to the private sector with a Peak Rated Capacity (PRC) of 22.5 MT during the last two years. Most of these blocks are expected to start production by 2025. The Ministry has also identified four coking coal blocks and the Central Mine Planning and Design Institute (CMPDI) also will finalize geological reserves (GR) for four to six new coking coal blocks in the next two months. These blocks may be offered in subsequent rounds of auction for the private sector. CIL has planned to increase raw coking coal production from existing mines up to 26 MT and identified nine new mines with PRC of about 20 MT by FY 2025. CIL has also offered six discontinued coking coal mines, out of the total 20 discontinued mines, on an innovative model of revenue sharing to the private sector with expected PRC of about 2 MT.
Enhanced domestic production and sustainability for coal can work wonders for the Indian economy. Reduced import costs would translate to reduced input costs for a number of core industries like energy and iron and steel. It may also mean more employment. The government must make true its intentions to enhance coking coal production.