Russia boosts railed coal volumes on Turkish demand

Monday, 13 Jun 2011

It is reported that state owned rail monopoly Russian Railways transported 123.2 million tonnes of coal in the first five months of 2011 up by 1.1%YoY reflecting a rise in exports to Turkey.

The rise in coal shipments, considering the harsh 2010-11 winter, offers some optimism to the export market with coal exports widely recognized as being restricted by insufficient rail infrastructure. But it appears unlikely that European end users gained particularly from the rise in rail shipments.

Data made available to Montel by EU statistics agency Eurostat show that in fact, Russian exports to Europe declined by around 1.2% in the first quarter of 2011 to 11.83 million tonnes when compared with the corresponding period last year.

One Russian coal trader said “I don’t think there was a big change.”

A London based coal analyst said “I’d say Black Sea shipments surged. It makes sense, as Richards Bay supplies have been very expensive for.”

One Istanbul based trader said Turkey the beneficiary Turkey has been boosting coal import volumes amid rising coal-fired power capacity. He said that “Turkey will be raising coal imports by 8 million tonnes to 10 million tonne per year over the next three years, noting imports so far this year are already higher year on year.”

The trader said “We’re taking coal from Russia, but also from Colombia and other countries it all depends on the price, adding around half of the country imports are spot purchases. Turkey imported around 15 million tonnes of thermal coal in 2010. Russian Railways which is one of the biggest railway companies in the world and plans to invest around USD 70 billion by 2020 in developing and improving the network. Total rail freight volumes in January to May reached 504.2 million tonnes of which coal accounted for the largest cargo share followed by oil and oil products totaling 105.1 million tonnes.”

(Sourced from Montel)