MCPA MarketWatch - October 2026
What We Are Watching—and Why It Matters
October 2026
For early October, India provided the most consequential development. Its draft national steel policy projects coking-coal demand rising from 72 million tons in 2025 to 236 million tons by 2047. Because India currently imports approximately 92% of its requirements, the proposal puts an official number behind the long-term opportunity for global suppliers—including Appalachian producers.
Near-term markets were less bullish. Australian export data point to changing supplier shares, while Chinese coking-coal prices stabilized after their recent decline without clear evidence of stronger underlying steel demand.
1. India officially quantified its long-term coking-coal requirement
What changed: India’s Ministry of Steel released its draft National Steel Policy–Vision 2047, targeting:
Crude-steel capacity of 604 million tons, up from 220 million tons.
Finished-steel consumption of 505 million tons.
Coking-coal demand of 236 million tons, up from 72 million tons in 2025.
PCI demand of 48 million tons, up from 17 million tons.
The draft says approximately 92% of India’s current coking-coal requirement is imported, primarily from Australia, the United States and Russia. It calls for diversified sourcing, overseas asset acquisitions, long-term supply arrangements, additional washeries and greater use of domestic coal blends. Public feedback is due October 30.
Why it matters: This is the clearest official confirmation yet of India’s potential impact on global metallurgical-coal markets. The projected requirement is more than triple today’s level, even though the policy also assumes greater scrap use, PCI injection and eventual adoption of lower-carbon technologies.
The 236 million ton figure is projected total demand, not an import forecast. Actual imports will depend on domestic coal quality, washery performance, technology choices and whether the draft targets are achieved.
2. New Australian data suggest India is diversifying its suppliers
What changed: BigMint estimates that Australia exported 14 million tons of coking coal in September, up 12.4% year over year. But the destination mix shifted significantly:
Shipments to China more than doubled to 3.34 million tons.
Shipments to India fell 41.6% year over year to 1.63 million tons.
January–September Australian shipments to India declined 12.3% to 25.98 million tons.
Total Australian coking-coal exports increased 4.5% during the first nine months.
By comparison, official EIA data show U.S. metallurgical-coal exports to India increased 26.6% during the first half of 2026, reaching 6.23 million short tons. The periods and units differ, so these figures should not be used to calculate market share directly.
Why it matters: The data suggest that India’s growth opportunity involves both increasing demand and supplier diversification. Australia remains the dominant supplier, but U.S., Russian and Mozambican coal is becoming more important to Indian buyers.
3. China’s coking-coal market rebounded modestly, but steel demand remained weak
What changed: Bargain hunting improved Chinese coking-coal auction activity during October 8–15, and Mysteel’s national index recorded modest gains. Shanghai Metals Market (SMM) nevertheless quoted Linfen low-sulfur coking coal at 2,250 yuan per ton on October 16, unchanged from October 12 and approximately 10% below September 21.
SMM reported faster mine restarts in Shanxi but said steel mills remained loss-making and were actively reducing coke purchases. Australian premium low-volatility hard coking coal was reported at approximately $268 per ton FOB on October 16, essentially flat at the end of the week. Shanghai Metals Market (SMM)
New September production data reinforce the cautious interpretation:
Chinese crude-steel production was 73.59 million tons, up only 0.1% year over year.
Pig-iron production—the more relevant metallurgical-coal demand indicator—fell 1.4%.
January–September crude-steel and pig-iron production declined 2.9% and 3.0%, respectively.
Why it matters: The market found some support after its sharp decline, but the rebound appears driven by low-price buying and supply uncertainty rather than a durable improvement in blast-furnace demand.
4. MSHA reopened an underground-mine respirator rulemaking
What changed: On October 16, MSHA reopened the record on its proposed rule concerning powered air-purifying respirators in underground mines.
The proposal would permit certain non-MSHA-approved PAPRs in specified areas of gassy underground mines while establishing equipment, maintenance and operating-condition requirements. MSHA scheduled:
Speaker-registration deadline: November 13
Virtual hearing: November 17
Post-hearing comment deadline: December 8 - The docket is MSHA–2025–0089.
Why it matters: The proposal directly affects underground operators’ ability to provide respiratory protection where currently permissible PAPR equipment may be unavailable. Practical feedback from mine operators and safety personnel could materially influence the final requirements.
No other consequential new state-level metallurgical-coal action was identified in West Virginia, Virginia, Kentucky or Pennsylvania.
5. U.S. steel production remained higher year over year
U.S. raw-steel production totaled 1.796 million net tons during the week ending October 10. Production was down 0.3% week over week but up 4.1% from the comparable 2025 week. Year-to-date production remained 5.3% higher, with estimated capacity utilization at 79.0%. American Iron and Steel Institute
Why it matters: Domestic steel production remains constructive, although aggregate output does not translate directly into metallurgical-coal consumption because much U.S. production uses electric-arc furnaces.
What We Are Watching Next
Whether India’s final steel policy retains the 236-million-tonne coking-coal projection after the October 30 consultation deadline.
October Indian imports by origin, particularly the U.S. share.
Whether declining Australian sales to India represent a sustained supplier shift or monthly volatility.
Shanxi mine restarts, Chinese coke-price negotiations and blast-furnace production.
Participation in the November 17 MSHA PAPR hearing and coordination of comments before December 8.
Formal implementation details for China’s announced commitment to purchase U.S. coal.
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