Russian coal exports constrained

Russian coal supplies for exports are being limited in January as low temperatures slowed coal unloading and shipments from ports, resulting in rail congestion at terminals.

State-run Russian Railways (RZD) cut about a third of suppliers' applications for coal delivery for exports this month and has imposed a number of restrictions on coal exports to ease congestion.

As of 14 January RZD had given approval for about 20.7mn t to be shipped for export in January, much lower than the 29.8mn t requested, according to rail data.

The rail operator reduced deliveries to ports by 24pc, authorising shipments of around 15.7mn t, while cutting supplies to overland border crossings even more sharply — by about 45pc to 5mn t.

The number of idle trains increased on all rail lines leading to ports, with the Oktyabrskaya Railway that serves northwestern ports being the most congested export route. The number of idle trains on this railway more than doubled on the month in mid-January to 215, with 183 loaded and 32 empty. A total of 183 trains — 168 loaded and 15 empty — were standing idle on the North Caucasus Railway leading to southern ports, up from 140 in mid-December. Far Eastern Railway, which serves ports in Russia's far east, was the least congested, but the number of idle trains on its lines also almost doubled — to 114 — with the lion's share of these loaded trains.

RZD has introduced new restrictions on supplies to Russian ports and overland border crossings this month. On 11 January, the operator banned for an indefinite period coal supplies to the Russian Black Sea ports of Novorossiysk and Tuapse. On 4-13 January, RZD halved coal supplies to the Vanino Commercial Sea Port terminal at the far eastern port of Vanino, after it fell behind with unloading coal and a backlog of railcars built up. Mechel, which controls the terminal, is its largest coal supplier.

RZD on 11 January banned deliveries of anthracite and bituminous coal, excluding coal concentrate, to Slovakia's Ganiska station destined for steel producer Steel Kosice through the Uzhgorod-Matevtse border crossing between Ukraine and Slovakia. The rail operator restricted deliveries of all cargoes to Finland through the border crossing at Buslovskaya on 11-15 January and halved supplies to Grodekovo in January, market participants said.

Find more news, price information and market analysis on Russian coal exports in the Argus Russian Coal report.