National Coal Index

Context: The National Coal Index (Provisional) recorded a notable decline of 3.48% in June 2024, suggesting that there is sufficient coal available in the market to meet increasing demand.

• Introduction: The National Coal Index (NCI) was introduced by the Ministry of Coal to calculate revenue share based on market prices, particularly when coal mines began being auctioned on a revenue share basis.
• Components: The NCI accounts for the prices of both coking and non-coking coal of various grades transacted in a specific month, relative to a fixed base year (2017-18). It aggregates prices from all sales channels, including import prices.
• Function: The NCI acts as a reliable indicator of market dynamics, offering valuable insights into price fluctuations in the coal market.
• Significance: The recent decline in the NCI reflects a more balanced market, which will help harmonize supply and demand dynamics, leading to a more equitable distribution of coal resources.