JSW Steel CEO Highlights Concerns Over India's Metallurgical Coke Import Restrictions

Jayant Acharya, the chief executive of JSW Steel, expressed significant concerns on Tuesday about India's import restrictions on metallurgical coke, a critical fuel used in steelmaking. He noted that JSW Steel, India's largest steel producer, is now primarily sourcing coking coal, the raw material for coke, from countries like Australia, the U.S., and Mozambique.

This issue stems from Indian steel mills meeting only about half of their metallurgical coke requirements from domestic sources in the first half of 2025, highlighting a substantial supply gap and increasing calls to ease import limitations. The Indian government initially imposed these import curbs in January to support the domestic metallurgical coke industry. Subsequently, in June, these restrictions were extended, incorporating country-specific quotas and capping overseas purchases at 1.4 million tons for the period between July 1 and December 31.

Steel producers have urged the government to substantially increase these import quotas, seeking an almost sevenfold rise to alleviate the current crunch. JSW Steel executives reportedly appealed to government officials in August to raise the company's allocation, citing operational difficulties at two of its plants in Karnataka and Chhattisgarh.

Impact These import curbs can lead to increased production costs for Indian steel manufacturers. If domestic supply is insufficient and import quotas are tight, prices for metallurgical coke may rise, subsequently increasing the cost of steel production. This could translate into higher steel prices for consumers, affecting various sectors reliant on steel, such as construction and automotive. For companies like JSW Steel, it presents significant operational challenges and potential risks to profitability and expansion plans. The government's objective is to foster domestic production, but the immediate consequence is a strain on the steel industry's supply chain. Rating: 7/10.

Difficult Terms: Metallurgical Coke: A fuel derived from coal, essential for smelting iron ore in blast furnaces to produce steel. Coking Coal: A type of coal with specific properties that allow it to be converted into coke. Import Curbs: Government regulations that limit or restrict the import of certain goods into a country. Quotas: A fixed quantity of a particular good that is allowed to be imported into a country. Low-ash metallurgical coke: A high-quality coke with minimal ash content, which is desirable for efficient steel production.