India has reinforced its trade controls on low-ash metallurgical coke, a critical raw material for blast furnace steelmaking, by extending quantitative import restrictions until June 2026 and introducing provisional anti-dumping duties on imports from key supplying countries. The twin policy measures are expected to keep import volumes capped well below industry requirements, intensifying cost and availability pressures for the domestic steel sector.
Low-ash metallurgical coke imports had surged to around 5 million tonnes in 2024, driven by rising steel production and limited availability of suitable domestic grades. However, the introduction of quantitative restrictions in 2025 sharply reduced annual imports to approximately 2.85 million tonnes, nearly halving overseas supply. With the latest extension of quotas and the imposition of provisional duties, imports are now projected to remain capped at similar levels in 2026—significantly lower than the steel industry’s estimated requirement of over 6 million tonnes per year for low-ash varieties.
Policy Measures Tighten Supply Further
Under the extended regime, low-ash metallurgical coke—typically defined as having ash content below 18%—continues to fall under restricted imports, requiring allocations and regulatory approvals. In parallel, the government has imposed provisional anti-dumping duties ranging from roughly $60 to $130 per tonne on low-ash met coke imports from countries including Australia, China, Colombia, Indonesia, Japan and Russia, effective for six months through the end of June 2026.
While the two measures are legally distinct, their combined impact is significant. Even within permitted quotas, higher landed costs due to anti-dumping duties are expected to discourage imports, effectively tightening supply beyond headline volume caps.
Implications for the Steel Industry
Low-ash metallurgical coke is essential for efficient blast furnace operations, offering higher productivity and lower fuel rates. India’s domestic production of low-ash coke remains limited, forcing steelmakers to rely on imports for consistent quality.
With import availability constrained, steel producers face a dual challenge:
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Rising input costs, as restricted supply and higher duties push up coke prices
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Operational risk, as substituting with higher-ash coke can impact furnace efficiency and hot metal output
Industry estimates suggest metallurgical coke accounts for 35–40% of blast furnace steelmaking costs, making mills particularly sensitive to price movements. Any sustained increase in coke costs is likely to pressure margins and, in some cases, prompt partial pass-through into finished steel prices.
Trade-Off Between Protection and Competitiveness
The policy push aims to protect domestic coke producers from low-priced imports and encourage local capacity development. However, steelmakers argue that the pace of domestic capacity expansion and quality improvement may not be sufficient to bridge the near-term supply gap for low-ash coke.
This has created a structural tension between import substitution objectives and steel sector competitiveness, especially as India continues to pursue ambitious steel capacity and infrastructure targets.
Medium-Term Outlook: Tightness to Persist
Looking ahead, the continuation of import curbs through mid-2026 suggests that supply tightness in low-ash metallurgical coke will persist in the medium term. Unless domestic production improves materially or policy restrictions are recalibrated, steelmakers are likely to operate under elevated input cost conditions.
While demand growth in steel remains supportive, margin recovery may remain uneven, particularly for blast furnace-based producers with limited sourcing flexibility. The policy landscape indicates that raw material availability—not just pricing—will remain a key variable shaping India’s steelmaking economics over the next year.