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Coal India Unit to Boost Production on Demand From Steelmakers |
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Wednesday, 09 December 2009 |
 Bharat Coking Coal Ltd., a unit of India’s biggest coal producer, said it aims to increase production by almost 8 percent in the next financial year to meet demand for the steelmaking raw material.
Output will be increased to 4.3 million metric tons in the year ending
March 31, 2011, from this fiscal year’s planned 4 million tons,
Technical Director D.C. Jha said today in a telephone interview from
the eastern city of Dhanbad in Jharkhand state, where the company is
based. The unit of Coal India Ltd. plans to raise production at its
underground and open-pit mines at Jharia in Jharkhand, he said.
Indian steelmakers, whose sales revived faster than their international
peers following the global recession, are scouting for additional raw
material supplies in India and overseas. Local demand is expected to
grow by about 10 percent in the second half of this financial year as
automobile and construction companies increase steel purchases.
“Steel firms are placing orders for higher quantities of coking coal,” Jha said. “We are trying to meet the demand.”
Coal India formed a venture with Steel Authority of India Ltd., India’s
second-largest producer, Rashtriya Ispat Nigam Ltd., power company NTPC
Ltd., and iron-ore producer NMDC Ltd. in 2007 to acquire coking coal
mines overseas to secure supplies. JSW Steel Ltd, India’s third-largest
producer, may spend $500 million buying coal mines overseas, Managing
Director Sajjan Jindal said last month.
Citigroup Global Markets in October raised price forecasts for coking
coal, citing Chinese and Indian imports, restarts of idled
blast-furnace capacity and supply constraints. Hard coking coal will
sell at $200 a metric ton in the next two fiscal years starting on
April 1, London-based analyst Liam Fitzpatrick wrote in a report dated
Oct. 13. That was up from an earlier $140 estimate for both years.
Source: Bloomberg
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