Steel Authority of India Ltd. (SAIL) is exploring Mongolia as a potential new source of coking coal as the state-run steelmaker looks to diversify its raw material supply base and reduce dependence on traditional overseas suppliers.
The move comes as Indian steel producers seek reliable sources of high-quality coking coal to support steel production. Coking coal is a critical input for blast-furnace operations, and supply disruptions or price volatility can significantly affect steelmakers’ costs.
Mongolia, which has substantial coal resources and is a major supplier to neighbouring China, could offer an additional sourcing option for Indian steel companies. SAIL is understood to be evaluating the quality and suitability of Mongolian coal for its operations.
The company’s interest in Mongolia also reflects India’s broader efforts to diversify its critical mineral and raw material supply chains. Establishing alternative sources could help Indian steelmakers manage risks arising from concentration in a limited number of exporting countries.
If the trials meet technical and commercial requirements, Mongolian coking coal could become part of SAIL’s future procurement strategy. The development could also open the way for stronger trade links between India and Mongolia in the coal and steel sectors.
SAIL’s efforts come amid continued focus by Indian steel producers on securing long-term and cost-effective supplies of coking coal to support domestic steel capacity expansion.