Posted on 01 Aug 2023
Following the Chinese sanctions on Australian products, including coal, BHP expects the large-scale steel capacity expansions in India to boost coal demand, BHP chief commercial officer Vandita Pant has told the Financial Times.
According to Pant, around 40% of BHP’s coking coal is now heading to India, up from 30% in 2019. With shipments to India ramping up, the executive says India has become a very big market for BHP, Kallanish notes.
Melbourne-based BHP did not reply to Kallanish’s request for comment by Monday deadline.
India plans to scale up its crude steel production to 300 million tonnes/year by the end of the fiscal year ending 31 March 2030 (FY30), up from 125m t/y capacity in FY23.
Even if India does not achieve its production target, the nation still has huge potential. Indian demand is set to become pivotal to the growth of BHP’s metallurgical coal business in the coming years, Pant observes. A decarbonisation push within India means demand for high-quality Australian coal, with its lower emissions, should grow.
"As Indian steel mills continue to invest in and get really focused on decarbonisation, which they are, the mix of met coal used by the steel mills will continue to pivot towards higher and higher quality coal, which plays to our strengths," the executive concluded.
Source:Kallanish
