Russia may limit coking coal exports - Report - 03 Jul, 2008
Russian newspaper Vedomosti reported that Russia may demand its coking coal companies supply a large part of their output to the domestic market in a move that could limit exports of the steelmaking raw material.
Vedomosti reported that under the plan, Russian miners would be required between them to supply a minimum 50 million tonnes of coking coal concentrate a year to the domestic market. This is equivalent to 93% of its production last year.
Analysts however said such a plan would be difficult to enforce and that Russian steel makers are already protected by a booming domestic steel market and a high degree of vertical integration.
Mr Mikhail Seleznyov Deutsche Bank analysts and Mr Olga Okuneva said "Restrictions in coal and the broader steel related commodity segment will be hard to implement. They said the steel sector is almost entirely privately held and generally well managed. The government would have to abandon market mechanisms to even partially succeed, and we believe this is not on the government's agenda."
Russia is the world's third largest coal exporter behind Australia and Indonesia and ranks fifth in terms of production.
