Nalco Targets 4 Million Tonnes Of Coal Production In FY26

National Aluminium Co. aims to increase its coal production to 4 million tonnes in the current financial year, according to Chairperson Brijendra Pratap Singh.

"One thing which we are trying to do this year is increase our volumes. We are increasing our coal production, which was around 2.8 million tonnes last year," the managing director told NDTV Profit in a conversation. "This year, we'll be doing around 4 million tonnes of coal production."

Singh added that his company aims to boost the "calcined alumina production by around 2 lakh tonnes". He continued that the rise in coal production will help in minimising power costs, which constitute about 30% of the total cost of aluminium production.

In FY26, Nalco has decided to focus on a three-pronged strategy: "Increasing our volumes, improving our efficiencies and reducing the cost. It will substantially increase our overall margins."

The fifth stream of Nalco's alumina refinery, originally slated for September 2025, has been delayed to December 2025 or January 2026. Further, commissioning will take another two–three months. The new facility, set to add 10 lakh tonnes of capacity, will not contribute to this financial year's figures. "Maybe next financial year, we will be adding around 5 lakh to 6 lakh, with this new refinery and in the subsequent year, 10 lakh," he said.

He added that the Pottangi bauxite mine in Odisha will support this expanded refinery capacity. It will commence operations by May or June 2026.

Singh said that calcined alumina accounted for approximately 40% to 44% of the company's total revenue in FY25. This figure can move up by 5% to 6% in this financial year due to increased production volume.

The top executive said that the exceptional alumina prices seen last year, averaging $580 per tonne, were unlikely to be repeated. "It will be between $400 and $450," he noted. 

Alumina spot prices are currently hovering around $400. Despite this, the projected average remains an improvement on the $350 per tonne seen in FY22 and FY23, he said.

Raw material costs account for about 20% of overall expenses. He said that raw material prices, such as caustic soda, currently at Rs 40,000 per tonne, and CP (calcined petroleum) coke, currently at Rs 39,000 per tonne, are expected to remain stable in the first half of FY26.

The company is also working to diversify its vendor base and explore import options to maintain cost competitiveness. "The main reason was calcined alumina prices, which have gone up, contributing around Rs 2,000 crore, and aluminium prices contributed around Rs 1,500 crore or Rs 1,600 crore," Singh said.