Russia threatened on the global coal market

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www.vsyako.netPhoto: Alexander Kryazhev / RIA Novosti

Russia by 2035, is going to take a quarter of the world coal market. Writes about this family-owned Demyan Kudryavtsev, the newspaper “Vedomosti” with reference to the draft Energy strategy of Russia until 2035.

According to the plans of the Russian authorities, by 2024, coal production will grow by 9.3 to 20.7 percent (down to 480-530 million tons) compared to the level in 2018. By 2035-th production will increase by 11 percent to 25 percent.

Russia plans to focus on supplies to the Asia-Pacific region, Southeast Asia, Middle East and Africa. However, with the increasing prominence of environmental issues in the countries of the Organization for economic cooperation and development, and addressing the largest coal importers — China and India — to reduce the share of the resource in the energy mix, coal’s future remains uncertain, the strategy says.

Experts say that in coming years coal, despite the drop in popularity, will continue to play an important role in Asia. However, demand will grow slowly and for increasing exports, Russia will have to oust competitors, says the analyst of “VTB capital” Dmitry Glushakov.

He explained that this is only possible at low production costs. However, in Russia they are combined with the high cost of rail transportation. As a result, at the time of delivery to the buyer the price of Russian coal is obtained almost the same as that of its main competitors (Australia, Indonesia and South Africa).

In the summer of 2019 prices for Russian coal in Europe dropped to the lowest values for the last three years, dropping below cost including shipping. The reasons were the warm winter in Europe and, as a consequence, excess coal stockpiles, as well as the trend for substitution of coal by more environmentally friendly fuels, particularly liquefied natural gas.

Video, photo All from Russia.

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