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Sources say that India's JSW is seeking a larger share of the met coke quotas in order to make up for the shortfall.

Two sources familiar with this matter say that JSW Steel in India has asked the government to increase the company's allocation of quotas for the importation of low-ash metallic coke, which is a fuel used to make steel, to cover shortfalls.

India, the second largest crude steel producer in the world, extended its country-specific import quotas for met coke from June to December. The purchase limit was capped at 1.4 millions metric tons.

Sources declined to identify themselves because the discussions were not made public. JSW Steel is India's largest steelmaker in terms of capacity.

JSW Steel executives asked government officials to increase their allocation. They cited operational difficulties in two of the company's units located in southern Karnataka state and central Chhattisgarh state, said the sources, without revealing how much more the company wanted.

"Naturally this quota hampers operations, and we have provided representation." One source said that the matter was still being discussed.

The source said that JSW Steel could have moved some of its excess from other plants to the affected ones, but logistics costs were an obstacle and there was not enough production to cover the shortfalls.

Emails seeking a comment from the Federal Trade Ministry were not answered. JSW Steel did not have any comment.

Import curbs have also worried major steel producers, such as JSW Steel and ArcelorMittal Nippon Steel India. They have claimed that the curbs hinder their expansion plans, because it's difficult to find preferred grades locally.

India launched a probe to determine if met coke with low ash was being imported from Australia, China and other countries, including Colombia, Indonesia, Japan and Russia. This came after a request by an industry group.

The imports of low-ash coke have doubled over the last four years, and the major raw material suppliers include China, Japan Indonesia, Poland, and Switzerland.

In early this year, Piyush Goyal, the Commerce Minister of India, urged steelmakers in India to use met coke.

Reports have indicated that the federal Ministry of Steel also supports the import restrictions, stating there is enough met coke available locally to meet local demand. Reporting by NehaArora. (Editing by Mayank Bhardwaj and Mark Potter.

(source: Reuters)