Russian exporters pay less for coal transportation

: Coal
21/02/01

The cost of rail delivery export costs for decreased at the beginning of this year in Russia due to lower railcar lease rates and the depreciation of the rouble. This, combined with higher export prices in Asia and Europe due to strong demand, has improved the position of Russian exporters and allows them to increase their margins.

Rail delivery costs for thermal coal transportation from Kuzbass towards the northwestern port of Ust-Luga fell by around 24pc on the year to $23.15/t in January. The burden of transport costs on Russian coal suppliers eased significantly by the start of this year. In January 2020, the cost of coal delivery by rail from Kuzbass to Ust-Luga accounted for more than 65pc of the Russian coal price on a fob Baltic ports basis compared with 35pc in January 2021, when export prices increased. And rail delivery for thermal coal transportation towards the far eastern port of Vostochny fell by 25pc to $27.89/t in January.

A steep fall in coal handling rates in Russian ports since the beginning of last year also supported coal exporters. The cost of coal handling in Rosterminalugol in Ust-Luga now is 27pc lower than a year ago, although rates in far eastern terminals decreased only moderately, giving less discount to suppliers than in the northwestern direction. The cost of coal transshipment in Vostochny decreased only by 3.6pc on the year at the start of 2021.

Despite lower delivery cost and higher margins, some Russian coal exporters still face problems with delivery towards far eastern ports due to limited railway capacity and high traffic. And many of Kuzbass' coal exporters are entering the Black Sea port of Taman to send Panamax and Capesize vessels to Asia.

Find more news, price information and market analysis on Russian coal exports in the [Argus Russian Coal](https://www.argusmedia.com/ru/coal/argus-russian-coal) report.

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

24/12/18

Alabama lock expected to reopen late April

Houston, 18 December (Argus) — The main chamber of the Wilson Lock in Alabama along the Tennessee River is tentatively scheduled to reopen in four months, according to the US Army Corps of Engineers (Corps). The Corps expects to finish phase two of dewatering repairs on the lock on 20 April, after which navigation can resume through the main chamber of the lock. The timeline for reopening may shift depending on final assessments, the Corps said. Delays at the lock average around 12 days through the auxiliary chamber, according to the Lock Status Report by the Corps. Delays at the lock should wane during year-end holidays but pick up as spring approaches, barge carriers said. The main chamber of the Wilson Lock will have been closed for nearly seven months by the April reopening after closing on 25 September . By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Alabama lock to remain closed until spring

24/12/17

Alabama lock to remain closed until spring

Houston, 17 December (Argus) — The US Army Corps of Engineers (Corps) has determined that the main chamber of the Wilson Lock on the Tennessee River near Florence, Alabama, will remain closed until spring 2025 as repairs continue. The Wilson Lock, the first lock on the Tennessee River, closed on 25 September after cracks in the lock gates on both the land and river sides were discovered. The main lock was closed to prevent further damage in the main chamber, although the auxiliary chamber was kept open for navigation. The Corps had been eyeing an earlier opening date for the main chamber since the start of November. Although months of repairs have taken place, the Corps resolved to keep the main chamber closed to preserve the lock and maintain personnel safety. The Corps, in partnership with the Tennessee Valley Authority (TVA), is still assessing the root cause of the cracking. A second de-watering of the gate is scheduled for the first three months of 2025 to repairs. No official date has been set for the lock reopening, although some barge carriers have heard of a late April opening date. A regular 15 barge tow has endured 5-6 days of delay through the lock on average, according to carriers. The Corps' Lock Status Report on the Wilson Lock reported a nearly two-week delay for tows navigating through the lock. This has been costly for shippers by forcing them to pay delay fees. Wilson Lock is the second lock in Alabama to undergo a lengthy closure this year. Most lock and dams along the US river system are over 70 years old, likely resulting in more closures in the coming year. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US river lock closures may delay product deliveries

24/12/13

US river lock closures may delay product deliveries

Houston, 13 December (Argus) — Mid-Mississippi River and Illinois River locks are expected to undergo long-term closures starting next month, slowing down some commodity deliveries. Three locks around the St Louis, Missouri, and Granite City, Illinois, region will be closed for repairs for up to three months starting 1 January, according to the US Army Corps of Engineers. The Mel Price Main Lock, where the Illinois River flows into the Mississippi River, and Lock 27's main lock, where the Missouri flows into the Mississippi, will also be closed from 1 January through 1 April. The Mel Price Main Lock will commence the final phase of replacement for its upstream lift-gate. Replacement of embedded metals will occur during the closure for Lock 27's main lock. Lock 25 will have a shorter closure date for a sill beam and guide-wall concrete installment from 1 January through 2 March. This is the first lock on the upper Mississippi River, after the Illinois River. These closures are expected to be more of a nuisance than a deterrent for commodity traffic, according to barge carriers. Ice in the river is likely to have melted by mid-March, which may cause barge carriers to wait in the St Louis harbor for the locks to open. Two other lengthy closures are anticipated on the Illinois River beginning on 28 January. The Lockport Lock — the second to last lock on the Illinois River — will be fully closed from 28 January through 25 March for full repairs to the sill and seal of the lock. The prior lock, Brandon Road Lock, will be closed during weekdays over the same time period, but traffic can pass through over the weekend. The lock closures and repairs are expected to delay some barge shipments, specifically to the Great Lakes and Burns Harbor. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

New Zealand boosts coal-fired generation in Jul-Sep

24/12/13

New Zealand boosts coal-fired generation in Jul-Sep

Sydney, 13 December (Argus) — New Zealand's power providers ramped up coal-fired generation during the July-September quarter, according to data from the Ministry of Business Innovation and Employment (MBIE), because of weaker hydroelectric generation. New Zealand's energy producers generated more coal-fired power between July-September compared to the same period of last year as hydropower storage levels slid across the country to a low of approximately 1,600GWh in August. Producers generated 884GWh of coal-fired power during the quarter, more than doubling on the year. This accounted for 8pc of the country's electricity generation during the quarter. In comparison, coal accounted for 3pc of the power mix in the same quarter a year earlier. The country's electricity authority in July reported that New Zealand's coal stockpile was relatively low at 140,000t, but producers had used 363,513t to generate electricity by September, indicating that imports were supporting the increased demand. New Zealand's coal imports increased by more than fourfold on the year in July-September, with importers shipping over 477,379t of sub-bituminous coal into the country, according to data from the MBIE. In comparison, the country imported 240,305t of coal over the whole of 2023. Some power providers started preparing to increase their use of coal generators early this year. New Zealand's largest utility Genesis Energy in May announced it plans to import coal into the country for the first time since 2022 , following a drop in gas and hydroelectric production. Major utility Meridian Energy reported in October that water levels at the Lake Pūkaki – New Zealand's largest hydroelectric storage lake – hovered below 91-year averages between May-August. But "all the rain [Lake Pūkaki] missed from April to August finally arrived in September," the company's general manager of wholesale, Chris Ewers, said. New Zealand's state-owned transmission provider, Transpower, has recorded increases in hydropower storage levels since late August, limiting the need for further coal generation. Storage levels in both the North Island and South Island currently exceed January levels. The country's appetite for coal has grown alongside a loosening of fossil fuel restrictions. New Zealand's current government decided to weaken coal mine consenting rules during its first round of planning reforms in late 2023, in an attempt to boost production. The government amended the Resource Management Act to allow miners to construct coal mines that affect wetlands, when previously mines affecting wetlands were banned. Resources minister Shane Jones in June introduced legislation to restart offshore oil and gas exploration across the country, reversing the previous government's ban. "Natural gas is critical to keeping our lights on… especially during peak electricity demand and when generation [from intermittent sources] dips," he said. By Avinash Govind Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US rail group optimistic about 2025 rail demand

24/12/12

US rail group optimistic about 2025 rail demand

Washington, 12 December (Argus) — US rail volume is likely to start strong in 2025, but railroads will need to navigate changing federal policies, the Association of American Railroads (AAR) said. Volume next year hinges on a few key factors, including the resilience of consumer spending, strength in the labor market, and the trajectory of inflation and interest rates, the group said. Railroads will need to remain vigilant as these economic indicators will be critical in helping assess rail traffic and broader economic health in the months ahead, AAR said. "Strong intermodal growth and stable consumer demand offers reasons for optimism," AAR said. "But railroads and the economy alike must navigate evolving policies and potential disruptions" as the US enters 2025 under a new administration, the group said. The AAR'S optimism comes as rail traffic in November "while by no means stellar, suggests that the broader economy remains on stable footing", AAR said. US intermodal rail volume set new records in November. The increase reflected strong consumer demand following job gains that pushed increased spending, AAR said. Intermodal traffic is made up primarily of consumer goods shipped in containers between different modes of transportation, although some scrap metal and specialty agriculture products ship this way. US railroads loaded an average of 282,000 intermodal containers and trailers per week, up by 11pc from a year earlier. That was the highest weekly average for any November since AAR began tracking intermodal data in 1989. Carload traffic fell by 3.8pc compared with November 2023. Carload traffic is primarily made up of commodities. Coal was the "biggest problem", AAR said. US railroads loaded 15pc less coal last month compared with a year earlier, while year-to-date loadings were down by 14pc from the same 11 months in 2023. If coal were excluded, monthly US carload traffic in November would have notched a 10th consecutive year-on-year increase. Industrial products volume was down by 1pc from a year earlier. Manufacturing is a major driver of US carload traffic, and that sector remains sluggish, AAR said. By Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more