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Pulse of Charcoal - September 25

Coal industry - actual figures and facts. Partner project of the Modern Analytical Agency (CAA) and the EastRussia portal

Mining, logistics, prices, export - all that the coal industry in Russia and in the world lives on is concise and to the point - in a new partner project of the Modern Analytical Agency (CAA) and the EastRussia portal

Pulse of Charcoal - September 25
Special project Coal of the East of Russia

A brief overview of the global coal market

Last week, steam coal quotes in Europe renewed their next all-time high, exceeding $ 180 / t, despite a slight correction in gas indices. The limited supply of material on the EU market and the approaching heating season against the backdrop of declining wind power over the week supported European coal prices. The cost of October futures on the European TTF trading platform was 69.4 EUR / MW ∙ h (-1.1 EUR / MW ∙ h by 16.09.2021). Coal reserves at ARA terminals amounted to 4.3 million tons (-0.3 million tons to September 16.09.2021, XNUMX).

Quotes for the South African material continue to remain at multi-year highs above $ 160 / t. According to experts, the indices of South African material will grow until the end of 2021 amid problems with the railway line connecting the coal-mining provinces of South Africa and the port of Richards Bay.

The high-calorie Australian coal index strengthened above $ 185 / t. Strong demand from Asian generators for thermal coal from Australia was positively reflected in the Australian material indices.

On September 23.09.2021, 2013, due to the rise in energy prices, the South Korean energy corporation KEPCO announced its intention to raise electricity tariffs. This will be the first tariff increase since November 2021. Previously, payments were charged at a flat rate, now the tariffs will be pegged to world energy prices and will be adjusted every three months depending on the dynamics of world prices for liquefied natural gas, coal and crude oil. In the second quarter of 571, KEPCO posted a net loss of $ XNUMX million.

The quotes of the Indonesian material 5900 kcal / kg GAR exceeded $ 140 / t. Increased demand from Chinese generators for low calorific coal from Indonesia continues to strengthen the Indonesian material quotes amid force majeure announced by a number of local mining companies due to heavy rains and floods in the country.

High prices in the PRC's domestic market are forcing Chinese steel mills to buy Australian material from Asian traders, which has a positive effect on quotes for Australian material, which has strengthened above $ 400 / t.


Russian Railways offers three options for expanding BAM and Transsib

Russian Railways has proposed a preliminary draft of the third stage of the expansion of the Baikal-Amur Mainline (BAM), including three options being considered by the national railway operator.

The first option is worth 333 billion rubles. (4.6 billion dollars) assumes additional export of coal from the Elga deposit in the amount of 16.6 million tons. Construction work is planned only at the BAM, with an emphasis on the Ulak-Komsomolsk section (in Ulak, the railway line going from Elga joins the BAM). At the same time, access roads to the ports of the Vanino-Sovgavan cluster, as well as to the areas west of Ulak, are not considered in this option.

The second option is designed to achieve a railway throughput of 2030 million tons by 210 and includes both the export of coal from Elga (16.6 million tons) to the ports of Vanino and the transportation of an additional 13.4 million tons towards the terminals of the Primorsky Territory. To implement this option, Russian Railways needs to build another 1.1 thousand km of the second main tracks on the BAM, in addition to the 553 km needed to ensure coal supplies from Elga. The project also provides for the expansion of construction work on the Ulak-Komsomolsk section, the modernization of the Tynda-Ulak section (in Tynda, the railway branch from Yakutia joins the BAM). According to Russian Railways, the cost of the second option is 1.22 trillion. rub. ($ 16.8 billion).

The third option involves an increase in freight traffic up to 240 million tons, which provides for large-scale work both on the BAM and on the Trans-Siberian Railway, including the construction of a railway track bypassing Khabarovsk, a bridge over the Amur, as well as the second Kuznetsovsky tunnel. This will require the construction of an additional 1.45 thousand km of the second main and more than 800 km of the third railway tracks. This option is estimated at 2.89 trillion. rub. ($ 39.5 billion). None of the above scenarios envisage the construction of the second Severomuisky tunnel, estimated at 200 billion rubles. ($ 2.7 billion).

According to experts, investments in the amount of 1.67 trillion. rub. ($ 22.9 billion) to increase the throughput from 210 to 240 million tons is an unreasonably expensive project that requires an alternative solution to increase the freight traffic of the Eastern landfill by an additional 30 million tons.

For reference: Phase II of the BAM development provides for an increase in the railway capacity to 180 million tons by 2025.

Coal production in Kuzbass increased by 9.3% in January-August 2021

In January-August 2021, coal enterprises of Kuzbass produced 158.1 million tons of coal (+13.5 million tons or + 9.3% compared to January-August 2020), according to the Ministry of Coal Industry of Kuzbass. The production of coking material during this period decreased to 46.8 Mt (-2.5 Mt or -5.1% versus January-August 2020), while the production of thermal coal reached 111.3 Mt (+16.1 Mt). or + 16.9% versus January-August 2020).

Photo: "Kuzbass Fuel Company"

Open pit coal companies produced 102.3 million tonnes (+ 12.6 million tonnes or + 14.0% versus January-August 2020), underground production increased to 55.8 million tonnes (+0.9 million tonnes or + 1.6% versus January- August 2020).

In August, 18.9 million tonnes of coal were shipped by rail, including 9.7 million tonnes westward, 4.8 million tonnes eastward and 4.4 million tonnes via local transport.

In August, 16.7 million tons of coal were supplied to consumers, including 11.6 million tons for export, 3.1 million tons to Russian metallurgical companies, and 1.2 million tons to local coal-fired power plants.

As of September 1, 2021, coal storage reserves in Kuzbass reached 15.1 million tons (-4.8 million tons, or -24.1% to September 1, 2020).

March 03, 2021 Vladimir Putin called for an increase in the export of Kuzbass coal to the east to 68 million tons per year by 2024 compared to export supplies in 2020 at the level of 53 million tons. In 2021, Kuzbass coal enterprises intend to increase production coal to 235 million tons (+15 million tons or + 6% by 2020).

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