Page 137 - RusRPTFeb23

and logistics costs have made it difficult for companies to find new sales markets through the ports of the European part of Russia. This has led to increased distances and higher costs for export railway tariffs, wagon fleet attraction, port transshipment, and freight,” the regulator said in a macroeconomic overview.
However, the situation is not uniform across all Siberian coal companies, the bank added. After the heating season began shipments to the power industry have increased. Producers of thermal coal from Eastern Siberia reported that shipments to power engineers rose by a third in October. The high demand for coal is expected to continue until the end of the heating season in March due to low water levels in the Yenisei basin's rivers, which will result in increased load on thermal power plants.
Coal production in the Kuzbass region, the leader in coal mining in Russia, decreased from 200.7mn tonnes in January-October 2021 to 181.5mn tonnes in the same period in 2022. Both open and underground methods of production saw a drop in volumes. Coal processing also decreased, falling from 112.7mn tonnes in January-October 2021 to 105.6mn tonnes in the same period in 2022.
The largest known deposit of rare earth minerals in Europe has just been discovered in Sweden’s Arctic, with potential to help the continent break free from China’s dominance on the market for the resources. The deposit, found by Swedish state-owned mining company LKAB, contains more than 1mn tonnes of rare earths, according to a statement in January. Work is still in an exploratory phase and the full extent of the deposit, just north of the company’s biggest mine in the Arctic town of Kiruna, is not known, LKAB said.
Russian steelmakers have been struggling with falling profits due to the strong ruble and the loss of premium markets in the US and EU in 2022.
As a result of sanctions, almost 31mn tonnes of steel products from Russian companies were reoriented towards the Asia-Pacific region. However, these are not considered premium markets and when shipments to these markets began in May, the strong ruble led to losses of RUB1000 per tonne. As a result, Russian steelmakers have seen a 42% decrease in metal shipments to Asian markets from May to October.
The Russian Steel Association has pointed out that there is a surplus of capacity in the country due to the pandemic and sanctions. In 2021, 69mn tonnes of steel were produced in Russia, while metal consumption in the country has not exceeded 46mn tonnes since 2000. In 2015, production of rolled metal reached 56.7mn tonnes, with 31mn tonnes shipped to consumers.
Domestic metal consumption has increased by 1.5% in January-September.
137 RUSSIA Country Report February 2023 www.intellinews.com