Coking coal just ripped 25% higher and India's steel sector is getting absolutely crushed by the move.
This is a classic commodity squeeze hitting at the worst possible time. India imports ~85% of its coking coal (mostly from Australia), so when prices spike like this, margins for steelmakers evaporate overnight. We're talking about Tata Steel, JSW Steel, and others suddenly facing brutal input cost inflation with limited pricing power on the output side.
The macro setup here matters: China's stimulus hopes + supply disruptions in Australia + weak rupee = perfect storm for Indian steel. If coking coal stays elevated, either steel prices have to rise (unlikely given weak demand) or margins collapse further.
Watch $X and other global steel names — if India's getting squeezed, the pain is spreading. Steel stocks have been dead money for months, and this doesn't help the turnaround thesis.
Commodity volatility is back. Raw material inflation isn't just a 2021-2022 story anymore.
This is a classic commodity squeeze hitting at the worst possible time. India imports ~85% of its coking coal (mostly from Australia), so when prices spike like this, margins for steelmakers evaporate overnight. We're talking about Tata Steel, JSW Steel, and others suddenly facing brutal input cost inflation with limited pricing power on the output side.
The macro setup here matters: China's stimulus hopes + supply disruptions in Australia + weak rupee = perfect storm for Indian steel. If coking coal stays elevated, either steel prices have to rise (unlikely given weak demand) or margins collapse further.
Watch $X and other global steel names — if India's getting squeezed, the pain is spreading. Steel stocks have been dead money for months, and this doesn't help the turnaround thesis.
Commodity volatility is back. Raw material inflation isn't just a 2021-2022 story anymore.