India: MCL auction sees high premiums for G8 grade coal

• G13 and G14 coal grades dominate allocations
  
  
• Premiums rise sharply despite low allocation
  
  

Mahanadi Coalfields Limited conducted its non-coking coal auction on 30 April 2026, offering around 2,774,700 t. Against this, total allocation stood at 448,000 t (around 16%) reflecting relatively weak participation and cautious buying sentiment amid softer domestic prices and subdued industrial demand.

Grade-wise performance

Mid-grade G13 and G14 coal dominated the auction, with allocations of 171,500 t and 172,500 t respectively. G13 achieved an average winning price of INR 1,307/t against a notified price of INR 1,016/t, implying a premium of around 29%.

G14 saw comparatively lower realisations, with an average winning price of INR 1,016/t over a notified price of INR 930/t, translating to a premium of about 9%, indicating weaker bidding interest in this segment.

G12 coal recorded allocation of 54,000 t at an average winning price of INR 1,337/t versus notified price of INR 1,101/t, reflecting a premium of approximately 21%.

Notably, G8 coal continued to command the highest premiums. Around 50,000 t was allocated at an average winning price of INR 4,284/t compared with notified price of INR 1,931/t, indicating a sharp premium of nearly 122%, driven by strong demand for better-quality coal.

Mine-wise trends

Among key mines, Garjanbahal OC contributed the highest allocation of 150,000 t of G14 coal, with moderate premium realisation, indicating steady but not aggressive demand.

Kulda OC remained a key contributor across grades. G13 from Kulda recorded strong realizations at INR 1,441/t, reflecting a premium of around 42%, while G8 from the same mine saw very strong bidding at INR 4,284/t, reinforcing continued demand for higher-grade material.

Bhubaneswari OC supplied 54,000 t of G12 coal at healthy premiums, while smaller volumes from Lajkura, LBL and Samleswari mines saw limited premium or near-notified level realisations, indicating selective buyer participation. Hingula and Samleswari G14 parcels cleared at or near notified prices, highlighting weak interest in certain pockets.

Buyer participation remains concentrated

Buyer participation was led by National Aluminium Company Limited, which secured 100,000 t entirely in G13 grade, indicating preference for mid-grade coal.

Sanish Ventures Private Limited emerged as another major buyer with 56,600 t across G13 and G14 grades, followed by SMC Power Generation Limited with 20,000 t split evenly between the two grades.

Other active participants included ABV Commercials, Shri Balaji Industrial Engineering Limited, Eastern Enterprises and Shree Balaji Coal Udyog, with allocations largely focused on G13 and G14 coal.

Bagadiya Brothers Private Limited and Oread Metalics Private Limited showed diversified buying across G12, G13, G14 and G8 grades, while Sarda Metals and Singhal Steel and Power also participated selectively.

Market insight

The auction reflected cautious market sentiment, with a significant gap between offered and allocated volumes indicating limited buying appetite. Lower premiums in G14 and selective participation across several mines suggest that buyers remained price-sensitive amid declining domestic coal prices and weak downstream demand.

However, strong premiums in G8 and healthy realizations in select G13 parcels indicate that demand for better-quality coal remains intact. The overall trend highlights a balanced but cautious market, where buyers are actively participating but limiting exposure to higher-priced or lower-demand grades.