India's Crude coal tar prices decline in Feb'26 amid supply surge and weak industrial demand

• Higher supply weighs on prices
  
  
• Weak downstream demand keeps buying cautious
  
  

India's crude coal tar market witnessed a notable increase in supply in February 2026 compared with the previous month, primarily driven by higher auction volumes from integrated steel producers.However, despite improved availability, demand from key downstream industries remained subdued, which exerted downward pressure on prices. Data indicates that total offered crude coal tar volume stood at around 59,700 tonnes in Feb'26, reflecting higher market supply during the month.

According to BigMint's monthly assessment, Ex-works East India crude coal tar prices declined sharply by INR 2,550/t m-o-m, settling at INR 35,000/t in Feb26. The decline was largely attributed to limited buying interest and cautious bidding behaviour, as buyers negotiated aggressively ahead of auctions expecting softer offers.

A market participant highlighted the prevailing conditions, noting that pre-auction negotiations among buyers have restricted price increases, even though coal tar inventory levels at several steel plants remain low, occasionally creating challenges for buyers in lifting adequate material.

SAIL leads supply growth

According to data compiled by BigMint, Steel Authority of India Limited (SAIL) emerged as the largest contributor to the countrys crude coal tar supply in February. The company offered 56,251 tonnes from its major steel plants, including Bhilai, Bokaro, Durgapur, Rourkela, and IISCO, marking a significant rise in availability compared with January and contributing substantially to the overall increase in market supply.

Plant-level auction trends

At SAIL Rourkela Steel Plant, around 8,000 tonnes of crude coal tar were auctioned in Feb26 at a weighted average price of INR 35,200/t, compared with 10,000 tonnes auctioned in January, indicating a slight reduction in offered volumes.

Meanwhile, NMDC Steel Limited offered approximately 600 tonnes in February, significantly lower than the 1,500 tonnes auctioned in January. The decline in supply was mainly attributed to lower production levels and reduced auction activity. Despite the reduced volumes, the average auction price stood at around INR 36,600/t, registering a m-o-m decline in line with the broader market trend.

Similarly, Rashtriya Ispat Nigam Limited (RINL) conducted an auction for 840 tonnes of crude coal tar during February, reflecting limited participation in the market compared with other integrated steel producers.

At SAIL Bhilai Steel Plant, approximately 5,011 tonnes were auctioned, with average bid prices around INR 35,000/t, as buyers anticipated softer price levels amid weak downstream demand.

In contrast, SAIL Durgapur Steel Plant resumed auctions in February, offering 19,000 tonnes after no auctions were conducted in January due to stock unavailability. Average bid prices ranged between INR 35,000/t and INR 37,500/t, reflecting moderate price dispersion depending on quality and buyer interest.

Separately, Tata Steel's Kalinganagar plant conducted a crude coal tar auction on 19 Feb'26, offering 2,000 tonnes, with the entire quantity sold at a weighted average price of INR 40,000/t. The material is often preferred as a fuel by foundry and steel industry participants, which supported relatively stronger bidding compared with other auction centres.

Demand conditions remain subdued

Despite the rise in supply, demand from coal tar distillation units, chemical manufacturers, and other downstream sectors remained sluggish during the month. Additionally, buyers adopted a cautious procurement strategy, relying on pre-auction negotiations and selective bidding, which limited upward price momentum.

Outlook

Crude coal tar prices are expected to remain range-bound in the near term due to adequate supply and moderate demand. However, a rise in petroleum fuel prices or improved demand from distillation, chemical, and carbon black industries could support prices, while persistent oversupply may keep the market volatile.