NMDC to Begin Commercial Thermal Coal Production in Q3 FY27, Targeting 1 Million Tonnes
India's largest iron ore miner enters thermal coal with a 52 million tonne Jharkhand reserve, aiming to generate 20% of revenue from non-iron ore minerals by 2030.
India's state-owned NMDC will begin commercial thermal coal production at its Tokisud North mine in Jharkhand between October and December 2026, Chairman Amitava Mukherjee said in an interview reported by PTI on September 7 (2026-09-07). The company targets selling up to 1 million tonnes of the fuel in FY27, its first commercial output from any commodity other than iron ore.4,5
NMDC has set a goal of generating 20% of total revenue from non-iron ore minerals by 2030. Thermal coal at Tokisud North is the opening move. The company will need to establish coal sales channels, logistics, and operational expertise from a standing start.3,6
Tokisud North was won by NMDC in a coal ministry auction. The mine carries reserves of 52 million tonnes and a peak annual rated capacity of 2.3 million tonnes, Mukherjee said. The 1 million tonne FY27 sales target is less than half that ceiling. The company confirmed it has already reached the coal seam, removing the main pre-commercial uncertainty.2,4
Coking coal is the larger bet in this diversification plan. NMDC holds the Rohne coking coal block, also in Jharkhand, with reserves of 191 million tonnes and a peak annual capacity of 8 million tonnes. Mukherjee said development at Rohne would run through FY27, with production expected to begin in FY28.2
India's steel sector has been expanding its iron ore footprint. Domestic production reached a provisional 312.53 million tonnes in FY2025-26, up 8% from 289.40 million tonnes in FY2024-25, SMM Analysis data show. Output in March 2026 alone reached approximately 34.5 million tonnes, against 25.9 million tonnes in March 2025.1
But strong domestic production has not prevented import growth at the processed end of the supply chain. Iron ore and pellet imports rose from 4.9 million tonnes to 12.2 million tonnes over three years, a 149% increase, reaching 3.9% of FY2025-26 domestic production, according to SMM Analysis.1
Ferrous scrap imports moved in the opposite direction. A Ministry of Steel parliamentary reply showed scrap imports declining from 9.5 million tonnes to 7.7 million tonnes over three years, an 18.9% fall. Lower scrap availability limits the electric arc furnace route and keeps blast furnace-dependent producers more reliant on coking coal supply.1
At the thermal coal level, NMDC's volumes in FY27 will not shift India's import balance. Newcastle thermal coal was priced at $137.05 per tonne as of September 20 (2026-09-20). India imports thermal coal in aggregate volumes that make 1 million tonnes from Tokisud North inconsequential for the seaborne market; the commercial start matters for NMDC's own revenue diversification timeline, not for coal buyers.2
The October-December production start is the first milestone to test. NMDC has reached the coal seam but has not reported commercial tonnages; new mining operations commonly encounter delays between first seam contact and sustained output. Any slippage in Q3 FY27 makes the 1 million tonne full-year target difficult to reach. Rohne coking coal — with 191 million tonnes in reserve, an 8 million tonne annual peak capacity, and a FY28 production start — is the asset with longer-term consequence for India's coking coal supply picture, and its timeline depends on development decisions NMDC has yet to report.2,4,6