In January-March 2025, net losses of Russian coal companies totaled 1.0 billion USD compared to a profit of 59 mio USD in the same period a year earlier. The share of loss-making companies amounted to 61.8% against 50.0% in the same period last year.
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of 18 billion USD are related to the restrictions imposed on Russian companies, while another 12 billion USD were withdrawn from the industry due to the growth of railway tariff and fiscal burden.
Therefore, in 2025, the downward momentum in the coal industry is intensifying amid falling prices in the global market and a sharp increase in production costs. Additional factors that continue to negatively affect the financial results of coal producers are high railroad tariffs, limited transportation capacity of railroad infrastructure, and Western sanctions.
Losses of Russian coal companies in 2024 reached 1.3 billion USD versus a profit of 4.5 billion USD a year earlier.
For many Russian suppliers, the current level of global prices and production costs make coal exports unprofitable, forcing them to reduce output and abandon projects aimed at developing new coal deposits. Since the sanctions cover more than 50% of the export volume, this will lead to an even greater contraction of Russian coal exports in 2025.
In this regard, the forecast for Russian coal output in 2025 may be revised downward, although earlier the Ministry of Energy expected production to remain flat.
Coal production in Kuzbass, Russia’s main coal mining region where high-quality material is mined, fell to 81.9 mio t in January-May 2025 (-5.3 mio t or -6.1% y-o-y).
Source: CCA Analysis
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