JSW Steel Shelves Plan to Import Coking Coal from Mongolia Over Logistics Hurdles

JSW Steel Limited has now put on hold the plan to import coking coal from Mongolia, citing extremely difficult logistics in transporting the critical raw material from the landlocked nation.

“Mongolia was being evaluated as an alternative source, but there are a whole lot of logistics-related issues for transportation,” said JSW Steel joint managing director Jayant Acharya on Wednesday. “Currently, it is not logistically feasible, so the entire plan is on hold.”

It has been disappointing news for India’s efforts to diversify into coking-coal imports, which will be important to reduce dependency on a few exporting nations and stabilize prices. India, the second-largest steel maker in the world, imports a big portion of its coking coal, with Australia being the dominant supplier.

In recent years, the Centre has been pursuing alternative sources, including Mongolia, Russia, and Mozambique. A senior government official confirmed in January 2025 that talks were being held on evaluating potential transport corridors for Mongolian coal. However, the absence of direct sea access and the requirement of moving shipments through neighbouring countries such as China or Russia make the prospect troubling.

“Analysts assert that Mongolian coking coal would make India less vulnerable to price volatility in the global market. Well, high transit costs, poor infrastructures, and geopolitical sensitivities have made the supply chain so complex and expensive.”

JSW Steel will remain committed to its current procurement strategy, Acharya said. “We will continue to source through our existing suppliers to fulfill operational requirements,” he said, adding that he would not specify any volumes or countries.

JSW Steel is one of India’s largest steel producers in terms of capacity and is part of the $23 billion JSW Group. The company has increased investments in green steel and digital transformation while wrestling with issues of raw material costs and supply security.

At least for now, Mongolia remains an unused card for Indian steelmakers, which encapsulates the larger problem of creating resilient supply chains in a very volatile global commodities market.