As we look to the establishing trends within the seaborne coal market, Russia is positioned for dominance by 2040,
Sibanthracite Group is ranked first in the production and export of UHG anthracite throughout the world, and is the largest producer of metallurgical coal at the domestic level. Sibanthracite Group is one of the most dynamically developing coal companies in Russia. The coal production amounted to 6 million tonnes in 2014, and 24.1 million tonnes in 2018.
As the global seaborne coal market continues to experience new demands and shifting trade dynamics, Russia’s position and role within the global seaborne coal market is expected to become increasingly predominant. While countries such as Australia, Indonesia and Russia have maintained strong footholds relative to their thermal coal production, emerging trends and shifts in trade dynamics may be shifting the focus away from the Southeast Asian’s production of coal, and are creating prime conditions for Russia to emerge as the global leader and provider of thermal coal.
The latest trend predictions released by the International Energy Agency show compelling evidence that as the coal trade dynamics continue to shift, Russia is positioned to out produce Indonesia – and secure its spot as the largest exporter of coal. Recent data released from Banchero Costa shows that in the first 9 months of 2019 alone, Russia’s total coal export rate increased over 7% globally – and even more noteworthy, Russia’s exports to Asian countries increased by 14% over the course of the year. And while both Australia and Indonesia experienced healthy gains in their Asia-specific exports, both countries lagged behind Russia in terms of total percentage gains made over the course of the year.
So what are the factors that are driving this impressive growth within the country? Russia has become attractive to both the Atlantic and Pacific basins as a low-cost supplier with an ideal central geographic position, resulting in favorable dry bulk freight rates. And one country in particular that is fueling Russia’s aggressive growth is China – where the Russian export business has grown a whopping 26.5% year over year – amounting to14% of the total share of all Russian coal exports allocated to China. Japan, where one third of all its electricity generation is fueled by coal, also increased their Russian-based coal supply this past year by over 16%.
As the Southeast Asian region continues to experience stagnation in their thermal coal production, Russia is expected to overtake Indonesia as the largest export of coal over the next two decades. Currently Indonesia is the world’s largest thermal coal exporter – and makes up almost 90% of the total coal production in Southeast Asia.
Russia’s evolution to becoming the largest global producer of coal is already well underway. As Russia continues to secure increasing share of the seaborne thermal coal market, albeit gradually, the pressure is certainly being felt by Indonesia and Australia.
Dmitry Bosov Sibanthracite Group is ranked first in the production and export of UHG anthracite throughout the world, and is the largest producer of metallurgical coal at the domestic level. Sibanthracite Group is one of the most dynamically developing coal companies in Russia. In 2018, it produced 24.1 million tonnes of coal and anthracite.