Coal in free fall

Alexander Titov, Head of the Global Oil Market Sector at the Energy Department of the Institute for Energy and Finance, commented to the internet portal InfoTEK on the coal export’s dynamics in the 1st quarter of 2024.

Export prices for Russian thermal coal in November 2023 – February 2024 significantly decreased for all shipping basins, Alexander Titov confirms.

"The export price of coal in the Far East (FOB Vostochny) also decreased in Q4 2023, but in January-February it managed to remain relatively stable at $104-107/ton, returning to the levels of mid-September 2023. As a result, the price difference between the "west" and the "east" for Russian coal miners in March reached a maximum of $30-40/ton," the expert calculated.

Titov cited the sufficiency of coal on world markets, stable reserves at terminals and power plants in India and China and the continuing decline in demand for coal in Europe as reasons for low prices. The cost of Russian coal is also affected by the increasing sanctions pressure, which leads to additional discounts.

Thus, export prices for Russian coal in Q1 returned to the lows of Q3 2023, however, the cost of delivering coal from the field to the port and transshipment increased in several items at once, the analyst says.