All news

EU embargo will not lead to critical drop of Russian coal export — expert

According to Aleksey Kalachev, Russia will redirect export to India, China and Southeast Asian countries, while Europe will start buying coal from South Africa and Australia

MOSCOW, August 9. /TASS/. Embargo of the European Union on Russian coal import becoming effective on August 10 will not have the critical impact on total coal export from the country, Finam analyst Aleksey Kalachev told TASS.

"If there is any decline [in exports], then I do not believe it will be critical. Probably, this will affect certain companies targeting exactly the European market. However, as a matter of principle, companies in Eastern Siberia and the Far East focused on deliveries to China, to Southeast Asia from the start," the analyst said. The share of supplies to Europe was about 10% for such majors as Raspadskaya and Mechel.

Countries will have higher costs of coal purchase and transport because the haul distance will grow, the expert said. Russia will redirect export to India, China and Southeast Asian countries, while Europe will start buying coal from South Africa and Australia. "In other words, redistribution of flows will simply take place but shipping costs and the overall price level will be higher for everyone against all fluctuations. I believe Europe will find the substitute for our coal and Russia will find destinations for it," Kalachev added.