The Mongolian and Russian Coals On the International Market – Is the Competition Real?

Abstract

The coal industries in Russia and Mongolia tend to increase coal supplies for export. The competition between Russian and Mongolian coal so far concerns only the Chinese coal market. In the future, however, there can be competition in the international coal market of the countries in the Asia-Pacific Region (APAC). Mongolia exports mainly premium (coking) coal. Russia exports coking and steam coal, with a predominance of steam coal. An analysis of the factors influencing the development of Mongolian and Russian coal export to the APAC countries indicates that the increase in export supplies is limited mainly by the capabilities of the transport infrastructure and geopolitical conditions. Mongolia has additional restrictions due to its geographical position, since the country does not have access to sea trade routes, which creates the need for cooperation with Russia and China to enable access to the sea coast. The Russian coal industry depends on the coal supply for export to a lesser extent than the Mongolian coal industry. At present, almost all Mongolian coal exports go to China, while the share of exports to China in the volume of Russian coal exports to the Asia-Pacific countries is no more than 30%. An analysis of the development indices for the coal industry in Mongolia and Russian regions exporting coal to the Asia-Pacific countries has not shown a significant influence of the Mongolian factor on the volume of Russian coal exports.