Coal India’s Coking Coal Output Declines by 8.7% in May

New Delhi, June 25: Coal India Ltd (CIL), India’s state-owned mining giant and the dominant player in the country’s coal production landscape, reported an 8.7% decline in coking coal production in May 2025. Output fell to 4.53 million tonnes (MT) from 4.96 MT in May 2024, according to provisional government data. This dip comes at a critical juncture, as the Indian government is aggressively pursuing initiatives to enhance domestic coking coal production to reduce its heavy reliance on imports for the vital steel sector.

Challenges to ‘Mission Coking Coal’ Targets

The reported decline in May is a setback for the Centre’s ambitious ‘Mission Coking Coal’, which aims for a significant increase in domestic coking coal production to 140 MT by FY2030. The goal is to achieve self-reliance and reduce India’s substantial import bill for this crucial raw material.

The production figures for the first two months of FY25 (April-May) also show a downward trend, with CIL’s coking coal output decreasing by 3.4% to 9.36 million tonnes, compared to 9.69 million tonnes in the same period last year. This highlights the ongoing challenges in ramping up domestic supply despite concerted government efforts.

Coking Coal: A Critical Raw Material for Steel

Coking coal, also known as metallurgical coal, is an indispensable raw material in the steel manufacturing process. India’s steel sector relies heavily on imported coking coal to meet its demand and ensure the high-quality raw materials required for steel production. In FY24, India imported a significant 57.58 MT of coking coal to bridge the gap between domestic availability and demand.

While total coal imports for FY25 saw a modest decline of 1.7% to 263.56 MT (from 268.24 MT in FY24), coking coal imports also slipped to 54.08 MT in FY25, compared to 57.22 MT in the previous fiscal year. Despite this slight reduction in imports, the continued dependence on foreign sources underscores the need for increased domestic production.

How Did The Shares Perform?

The shares of Coal India Limited closed at ₹391.80, down by 0.22% or ₹0.85 at the end of today’s trading session. They made an intraday high of ₹395.40 and a low of ₹391.00.

What’s Next For Coal India? 

Coal India’s 8.7% drop in coking coal output for May 2025 poses a challenge to the government’s ‘Mission Coking Coal’ target of 140 MT by FY2030. With April–May production also down 3.4% YoY, it highlights operational hurdles despite reduced imports. As steel demand rises and import reliance continues, CIL must accelerate production reforms to align with the self-reliance goal.

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