OTEKO terminal in Taman lowered the coal transshipment rate below $19 per ton

OTEKO has once again reduced tariffs for coal transshipment: the proposals for the second quarter, which the company sent to coal miners, are about $19 per ton. Coal miners confirm that negotiations on the resumption of transshipment are ongoing. However, according to experts, the profitability of FOB deliveries from Kuzbass through the ports of the south has not yet been achieved: with prices falling to the level of 2015–2016, the railway tariff and transshipment should be at the same level. The price proposed by OTEKO is $2 higher than then, and rail transportation is about 1 thousand rubles. expensive.

OTEKO has lowered the tariff for coal transshipment at its terminal in Taman below $19 per ton, the company told Kommersant. They reported that they “made an offer to large coal companies on the verge of profitability and are waiting for a reaction.” “Kommersant” saw one of the proposals made by a large coal company, which proposed a tariff of $18 per ton for the second quarter with a minimum shipload of 30 thousand tons. OTEKO previously reduced transshipment tariffs, according to Kommersant sources, from $38–32 to $27 per ton, but coal miners were not satisfied with this (see “Kommersant” dated April 4).

As Kommersant wrote, coal companies, due to the high cost of transshipment in February-March, stopped sending cargo through the OTEKO terminal in Taman (see Kommersant from February 6, March, 6 And March 19). According to the results of the first quarter, loading on the networks of JSC Russian Railways fell by 9.7 million tons, including by 8.7 million tons in the south and by 4.7 million tons for coal, which JSC Russian Railways explained by the lack of contracts for coal transshipment in the port of Taman (see “Kommersant” dated April 1). At a meeting on March 28 with First Deputy Prime Minister Andrei Belousov, sources tell Kommersant, OTEKO was criticized for “exorbitant rates” and persistence in issues that are no longer commercial, but political in nature. As follows from the minutes of the meeting at the Ministry of Transport on April 3 (available to Kommersant), the FAS found in the actions of OTEKO signs of establishing unreasonable tariffs for the coal transshipment service, and the company was ordered to develop and approve a commercial policy within a month. It should determine the procedure for calculating the tariff at an economically justified level, taking into account the industry average profitability and transshipment volume at the 2023 level.

JSC Russian Railways told Kommersant that they are “extremely concerned about the decrease in the volume of transportation of coal products to the port of Taman.” The total losses in loading, they note, in the second quarter could amount to 6.5 million tons, which is 20% of all traffic in the direction of southern ports.

“Given the necessary reserve of carrying capacity, requests for transportation to the terminal amount to a little more than 1% of the volume that was shipped last year (about 2.5 million tons per month),” the monopoly says. “Underutilization of this direction against the backdrop of the desire of coal companies to increase their product exports is puzzling.” According to one of Kommersant’s interlocutors in the industry, the losses of coal companies from the inability to export coal through southern ports in the first quarter alone could amount to about 52 billion rubles.

The coal companies did not officially say anything to Kommersant. A source in one of them confirms that OTEKO proposed reducing the base rate in the second quarter of this year with a guarantee of volumes. “We are at the stage of negotiations with the port to clarify and agree on mutually beneficial terms of cooperation,” says Kommersant’s interlocutor. “We have repeatedly stated that we support the idea of ​​​​determining transshipment rates linked to world indices and are ready to pay more as the market grows. But the price of coal today continues to show negative dynamics, we expect that this will also be reflected in the tariffs of the OTEKO terminal.”

Another source at a major coal company says $19-20 was the tariff that kept exports profitable at coal prices in late January and early February. Since then, prices have fallen by $12–17 per ton, depending on the grade of coal. In addition, from March 1, an export duty was added to the costs of coal miners, which currently amounts to $5.5, he adds.

“OTEKO, apparently, specifically sends out irrelevant proposals (in fairness, we note that it is lower than the previous one) in order, on the one hand, to extinguish the negativity on the part of the federal executive authorities and the government, but, on the other hand, not to fall to an acceptable level of rates in “$12-15,” says a Kommersant source. “OTEKO really hopes that their problem will be solved at the expense of the state budget: the abolition of the export duty, the reduction of tariffs of Russian Railways will soften the position of coal miners and make a compromise level of the rate of $19-20.”

Another Kommersant source in the market says that coal companies have felt their strength, felt support from the economic authorities, “and now they will press the port to the last.”

In his opinion, now is the time for the government to intervene as an independent regulator and convince coal miners to meet Taman halfway. The government should act as an independent judge and not be a tool in commercial struggles, he adds, suggesting it is now the coal companies’ turn to compromise.

Analysts say, however, that the profitability of exports to the south has still not been achieved. The estimated efficiency of thermal coal exports has generally increased as a result of price stabilization and a reduction in rental rates for gondola cars, says Alexander Kotov, head of consulting at Neft Research. “The netback of supplies through the port of Taman has returned to positive values ​​due to a significant reduction in transshipment tariffs, but is still far from the break-even level, and therefore coal miners insist on further concessions,” he adds. The chief strategist of the investment company Vector X, Maxim Khudalov, says that now the FOB price for high-quality thermal coal in the ports of the south is approximately $71–73. With transshipment of $19 per ton and the cost of rail transportation from Kuzbass is 3.6 thousand rubles. ($39) per ton leaves $17, or 1,581 rubles, per ton at the mine. However, the average cost of steam coal production is 2.5–3 thousand rubles. per ton. “To restore the attractiveness of shipments in the south, tariffs in ports and for the transportation of coal by rail should reach the level of 2015–2016,” he says. “Then transshipment was about $8–10, and transportation from Kemerovo to Novorossiysk cost 2500–2700 rubles . per ton. In general, there are no magic recipes: if the coal market shows the price levels of 2015, then the tariffs of infrastructure companies should return to the levels of those years.” Otherwise, Mr. Khudalov says, the decline in coal exports will continue, and infrastructure capacity will remain unused.

Natalya Skorlygina, Evgeny Zainullin