Major Coal India arms report drop in production in FY26

New Delhi, State-owned CIL arms Bharat Coking Coal Ltd (BCCL), Central Coalfields Ltd (CCL), Western Coalfields Ltd (WCL), and Mahanadi Coalfields Ltd (MCL) reported a decline in coal production in the just-concluded 2025-26 financial year.

The drop in production comes at a time when there is a sharp rise in the country's reliance on coal triggered by the West Asia crisis, which has tightened global gas and LNG supplies and pushed imported coal prices.

The production of BCCL dropped 12.3 per cent, CCL by 6.1, WCL by 8.8 per cent, and MCL by 3 per cent, according to the provisional data of Coal India Ltd (CIL).

South Eastern Coalfields Ltd (SECL) and Northern Coalfields Ltd (NCL) are the two Coal India subsidiaries which registered positive growth. While SECL production grew 5.3 per cent, NCL's was up 1.1 per cent.

An industry expert, however, warned that aggressive output targets without adequate storage could trigger widespread coal spoilage, exacerbating supply chain woes in India's energy sector.

"Over production of coal just to meet production targets without proper storage could lead to spoilage of coal," former power secretary Anil Razdan told PTI.

Coal India Ltd (CIL) accounts for over 80 per cent of domestic coal production.

The important and relevant issue is whether CIL met its contractual commitments for supply of coal to coal-based thermal power plants and other industry users.

"From what information is there in public domain, there are no reports of any shortage of contracted coal supplies in power production," Razdan said.

He also expressed hopes that the coal behemoth and the private coal industry will build adequate stocks to meet the peak summer electricity load, and also for taking care of extreme heat conditions and the subsequent monsoon season which could affect production in the mining areas.

On the other hand, former CIL CMD Sutirtha Bhattacharya said the actual production targets are market-synced and surplus stock holding in summer months is strictly avoidable.

"So, in my guess they produced in a non-monopolistic market scenario that required quantity. They must concentrate on quality assurance to become a brand leader. Hydrocarbon deficit will beef up the market, though, he said, adding that the coal sentiment as an energy source will be notches higher as will be for renewables.

CIL dropped by 1.7 per cent to 768.1 million tonne (MT) in FY26, over 781.1 MT in FY25.

The company's coal offtake, the quantity of coal dispatched from mines to consumers, during FY26 also declined 2.4 per cent to 744.8 MT from 763 MT in FY25.

CIL is the main fuel supplier to the country's power sector, providing the bulk of coal required by thermal power plants.

Its role is central-to-energy security, especially as coal still accounts for roughly 70 per cent of India's power generation, even amid rapid growth in renewables.

CIL operates through eight main fully owned producing subsidiaries, a planning/consultancy wing, and a foreign subsidiary in Mozambique. Major subsidiaries include BCCL, CCL, ECL, MCL, NCL, SECL, WCL, and CMPDIL. These subsidiaries collectively manage the majority of India's coal production.

The government had last month said India's domestic coal production is steadily matching consumer demands, with state-owned Coal India Ltd implementing robust measures to secure uninterrupted dry fuel for all sectors, amid escalating tensions in West Asia.

As a proactive step, CIL has planned 29 e-auctions in the current month, offering about 23.56 MT of coal.

"Of these 29 auctions, 5 auctions have already been conducted since March 12, 2026, wherein 73.1 lakh tonnes of coal were offered, and 31.96 lakh tonnes of coal have been booked, indicating adequacy of coal offered in the e-auctions," the coal ministry had earlier said in a statement.