Indonesia, South Africa Eye Revival in Indian Coal Market Share
According to industry executives, top coal exporters Indonesia and South Africa are strategically aiming to boost their thermal coal supplies to India, seeking to regain market share in the second-largest global import market for this fuel. While Indonesia and South Africa have traditionally been leading suppliers of thermal coal to India, they have faced challenges in recent years, losing market share to the United States, Russia, and Australia due to changes in trade routes prompted by geopolitical concerns.
The decline in Europe’s demand for coal has prompted exporters from Indonesia and South Africa to refocus their efforts on securing a more significant portion of India’s consistent coal import market. Executives highlight the advantage of their low-sulfur, high-calorific value coal as a critical factor in meeting the requirements of the Indian market. India’s steel production growth is seen as a positive factor for South Africa’s coal exports.
Kgabi Masia, Chief Coal Operations Officer at Exxaro Resources, emphasized the competitive edge of South Africa’s coal, stating, “We see our low sulfur, high calorific value coal as a big advantage to supply to the Indian market. India’s steel production [is] expected to do well, and it’s good for South Africa.” The move comes as both countries work to counteract the impact of losing market share to other coal-exporting nations.
South Africa aims to reclaim its position in the Indian market. Masia stated that for the year ending March 2025, they plan to supply 60 million metric tons from South Africa, intending to increase their contribution to the Indian market. South Africa’s share in Indian thermal coal imports had fallen to 16% in 2023 from an average of 22% in the three years before the pandemic.
Indonesia, another key player, is anticipated to supply around 110 million tons to India in 2023, according to Ardian Rosadi Budiman, Senior Manager of International Marketing at Adaro Energy. This reflects a nearly 7% increase from the 103 million tons supplied in the previous year.
As these exporters strategically position themselves to meet India’s thermal coal demands, the evolving dynamics in the global coal trade, influenced by geopolitical shifts and market demands, will continue to shape their efforts to regain and expand their market share in India.
