The largest importer of Russian coal in India refused new purchases

Tata Steel justified its decision with “uncertainty as a result of international sanctions” imposed on RUSSIA. The Financial Times emphasizes that the Indian company took this step,

The largest Indian importer of Russian coal in the first quarter of this year, Tata Steel, refused new supplies from Russia due to "uncertainty as a result of international sanctions." This is reported by the Financial Times, citing a statement from a company representative.

“In order to ensure business continuity, we have found alternative sources of raw materials, as transactions with Russian suppliers and bankers are currently subject to great uncertainty as a result of international sanctions imposed on Russia,” said a Tata Steel spokesman.

In the first quarter of 2022, according to the industry resource CoalMint, Tata Steel imported 617 thousand tons of Russian coal, and last month it delivered 246 thousand tons. These purchases were made even before Russia launched a special military operation in Ukraine, the newspaper specifies.

The Financial Times emphasizes that Tata Steel took this step, despite the acute shortage of coal in the country. According to the publication, about 70% of electricity generation in India comes from coal, but its reserves due to record heat are almost half lower than the average for this time of year, in connection with which the Indian authorities warn of power outages. 

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Tata Steel announced plans to stop buying coal in Russia in mid-April. “We made a conscious decision to stop doing business with Russia. To ensure business continuity, all of our steel operations in India, the UK and the Netherlands will begin to use alternative sources of raw materials,” the company said in a statement.

In ten months of 2021, Russia supplied to India about 22% of the 2.52 million tons of pulverized coal (PCI) imported by the country and about 2.2% of the 952 thousand tons of coking coal.

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REUTERS learned about the negotiations between Russia and India on the supply of coal Politics

Since the beginning of Russia's military operation in Ukraine, Western countries, including the US and the EU, have already introduced several packages of sanctions against Moscow. The previous, fifth package of EU restrictions introduced a complete embargo on the import of Russian coal. In addition, the sanctions package provides for the freezing of the assets of several Russian banks, an embargo on arms supplies to Russia, and a ban on Russian-flagged ships from entering EU ports.

In late April, Reuters reported that Russian and Indian officials held a series of meetings to resolve the coking coal supply situation. The agency pointed out that before international sanctions, Russia provided about 30% of the coking coal needs of the European Union, Japan and SOUTH KOREA, while India planned to double its Russian imports to about 9 million tons in 2022. However, due to problems with payment processing and logistics as a result of sanctions against Russia, India has had difficulties in delivering coal.

According to the Energy Ministry, coal exports from Russia in 2021 amounted to 215.1 million tons, including 22.6 million tons of coking coal. 166.6 million tons of coal were shipped to the domestic market. This figure includes both thermal coal (used to generate heat and electricity) and coking coal (used to produce steel). Russia steadily holds the third position, after Australia and Indonesia, in the ranking of the world's largest coal exporters with a share of over 16% in the international coal trade, according to the materials of the Ministry of Energy.

 

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