Russia to scrap coking coal export tariffs from 1 Dec'24
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- Tariff removal to boost competitiveness of Russian coal
- No word on lifting of duties on thermal coal, anthracite
The move follows a three-month extension of the tariff exemption announced in late August, which had been set to expire at the end of November. If the exemption is confirmed, it will provide significant relief to Russian coking coal producers, analysts say.
The export tariff is calculated based on the RUB-USD exchange rate, with a maximum duty of 7% being applied when the rate is at RUB 95=$1 or more. At the current exchange rate of RUB 108=$1, miners would have faced a 7% duty had the tariff not been lifted. For instance, Russian miners exporting K4 primary coking coal to China - currently priced at $141/wmt (CFR North China) assessed by Mysteel as of 28 November - would have incurred an additional $10/wmt in export duties.
TASS did not specify whether the export duties on thermal coal, primarily used for power generation, or anthracite, a key chemical feedstock, would also be lifted. In August, Russia announced that the export duty on all types of coal would be reinstated from 1 December.
Russian coal traders contacted by Mysteel Global did not provide confirmation on the status of the duties at the time of writing. "I have no information on this, but it is fair to say that miners have benefitted from the recent depreciation of the rouble against the dollar," one trader stated.
China remains a key market for Russian coal, particularly as Western sanctions over the Ukraine conflict have forced Russia to shift its focus to Asia-Pacific markets. However, any reintroduction of export tariffs would weaken the price competitiveness of Russian coal against other alternatives.
In January-October, China imported 79.7 million tonnes (mnt) of Russian coal, down 8.6% y-o-y, according to Chinese customs data. By type, thermal coal imports fell 16.1%, and anthracite shipments dropped 22.4%, while coking coal volumes surged 18% compared to the same period last year.
