Currently, exports of steam coal are profitable for all market participants, except for coal companies as shown by performance in 2024-2025. Moreover, RZD and ports enjoy the highest margins (46% and 85%, respectively).
Profitability of railcar operators in 2024 was at the minimum required level, while coal producers’ margins turned negative (-26%).
In 2025, the trend worsened, as RZD raised tariffs again and coal prices continued to fall.
In the period from 2019 to 2022, the company adhered to the principle of tariff indexation, based on the inflation rate. However, in 2022-2023, tariff hikes totaled almost 45%.
The Russian coal industry has lost almost 30 billion USD since 2022, resulting from sanctions pressure, as well as rail tariff and fiscal measures within the country. The bulk of the losses in amount of 18 billion USD are related to the restrictions imposed on Russian companies, while another billion USD were withdrawn from the industry due to the growth of railway tariff and fiscal burden.
From 2020 to 2024, the rail freight tariff for coal supplies from Kuzbass, Khakassia and the Novosibirsk region to seaports has already increased by almost 100% (4 times higher than the accumulated inflation over the period).
From December 01, 2024, freight rail tariffs were raised by another 13.8% as part of the planned indexation for 2025. Additionally, from January 01, 2025, a target surcharge of 2% was introduced. Furthermore, starting from 2022, Russian Railways abolished the reduction coefficients for transportation distance and steam coal.
These benefits were canceled on the back of high export prices, but were never restored despite the subsequent collapse of quotations. As a result, according to industry estimates, coal miners’ overpayments on railroad tariffs for 2022-2024 amounted to more than 2.5 billion USD.
In 2024, coal companies received a consolidated loss of 1.4 billion USD due to the simultaneous impact of such negative factors as a drop in global coal prices, high cost of rail transportation, logistical limitations and ruble appreciation. From the beginning of 2025, 64% of mining companies in Kuzbass have been unprofitable, and production in the region fell to 66.5 mio t in January-April (-3.5 mio t or -4.9% y-o-y).
Last week, Russian authorities held a meeting on the situation in the industry and developed measures to support the business, which will be submitted to President Putin for consideration, but no measures have been taken so far.
Source: CCA Analysis
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