Infrastructure bloat in Russia worsened during the winter season, when increased demand for Asia-bound goods due to European sanctions against Moscow caused rail congestion and weakened prospects for coal sales to China, according to data and market sources.
Russian President Vladimir Putin urged domestic companies to strengthen ties with Asia and Latin America after Europe imposed sweeping sanctions on Moscow after sending thousands of troops to Ukraine on February 2.
As part of the sanctions related to Ukraine, the European Union also imposed an embargo on the import of Russian coal on August 10.
“This year there was a big logistical turn to the east, which could not have been foreseen.” “Today, there is a very strong demand in this direction not only for the export of coal but also for the transportation of goods in all branches of the economy,” said the spokesperson of the Russian Railways.
China’s coal imports from Russia continued to decrease in October compared to previous months, according to the latest available data, as logistics bottlenecks in Russia hampered supply and falling Chinese demand also curbed appetite for fossil fuels. 6.
3 million tons of Russian coal arrived in October, compared with 6.95 million tons in September and a record 8.5 million tons in August, the General Administration of Customs said but it was still 26% higher than in October 2021.
Russia’s coal export restrictions could prove even more painful for China as demand for power generation and heating fuel increases in the winter. Transportation problems were also made worse by the lack of railcars.
According to Reuters, total exports to the east fell to 132 million tons in January–November, down from 135 million tons in the same period last year.
Russia’s main coal-producing Kuzbass region in western Siberia is likely to miss its coal export target this year and next due to persistent logistical bottlenecks, local governor Sergei Civiliev said last month.
He said the region is expected to export 58 million tons to the east this year, while Russian Railways could only export
8.5 million tons “at best.”
Next year’s plan is 63 million tons, while according to Tsiviljov, the railway offered 52.5 million tons for transportation.