In January-May 2025, net losses of Russian coal companies totaled 1.7 billion USD compared to profit of 114 mio USD in the same period a year earlier. Thus, losses for the first 5 months of 2025 have already exceeded overall losses for the whole of 2024, which totaled 1.41 billion USD. The share of loss-making companies amounted to 64.9% against 50.9% in January May 2024.
According to the financial performance indicators of Russian coal companies, their combined losses in 2025 may reach 3.8-5.0 billion USD if the ruble exchange rate and interest rates remain unchanged.
Given the required adjustments for some companies that submitted incorrect profit/loss statistics, the figure may exceed 5 billion USD.
Even coal mining companies in Yakutia, located 1,000-1,500 km from the Far East terminals (Vanino/Vostochny Port), unlike Kuzbass, which is 6,500 km from these ports, have been showing significant losses since the beginning of the year. In Q1 2025, Elga, Yakutia’s largest supplier, reported losses of 290 mio USD, while in Jan-May 2025 losses already exceeded 500 mio USD (vs. profit of 95 mio USD in Jan-May 2024).
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of 18 billion USD are related to the restrictions imposed on Russian companies, while another 12 billion USD were withdrawn from the industry due to the growth of railway tariff and fiscal burden.
One of the key challenges that affects the coal industry is the high level of debt. Currently, the volume of loans issued amounts to 15 billion USD and may spike to 17.5-18.8 billion USD by the end of 2025.
Therefore, in 2025, the downward momentum in the coal industry is intensifying amid falling prices in the global market, an increase in production costs and ruble appreciation. Additional factors that continue to negatively affect the financial results of coal producers are high railroad tariffs and limited transportation capacity of railroad infrastructure in eastbound direction.
Moreover, Western sanctions significantly reduced the number of countries importing coal, thereby exacerbating the decline in total Russian supplies as there are no alternative sales markets.
For many Russian suppliers, the current level of global prices and production costs make coal exports unprofitable, forcing them to cut output and investments. This will lead to a further decline in production and supplies in the near future.
Even if the market rebounds, it will be either impossible to boost volumes or require months to restore them. Russia is the largest supplier of high-quality thermal material and PCI coal. A decline in supplies caused by the lack of investment amid recovering demand will inevitably unbalance the world coal market and cause a rise in prices.
Source: CCA Analysis
