Factbox: Impact on EU, UK steel industry of bans on Russian coal imports

Men walk along by wagons loaded with coal at the Zlobino railway station in Russia’s Siberian city of Krasnoyarsk, November 26, 2014. REUTERS/Ilya Naymushin

April 8 (Reuters) – The European Union on Friday formally adopted its fifth package of sanctions against Russia, including a ban on the import of coal. read more

Existing contracts will have to be terminated by the second week of August, meaning that Russia can continue to receive payments from the EU on coal exports until then.

Britain said this week it would ban imports of Russian coal by the end of 2022. read more

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The bulk of Russian exports are of thermal coal used in power stations, but it also ships metallurgical coal used in steel blast furnaces. read more

The impact on the met coal market is expected to be less than on thermal coal, Morgan Stanley said in a note.

Russia shipped 32 million tonnes of met coal to Europe last year, making up about 17% of Europe’s imports, the note said.

“Given met coal’s smaller export market and its higher value vs thermal coal, it should be easier to achieve a full redirection of trade flows,” Morgan Stanley added.

Below are European steel company responses when contacted about the ban.

The world’s second-largest steel steelmaker said a “significant part” of its European coal usage was already sourced from outside of Russia. “While specific types of coal were supplied from Russia, we are replacing this with alternative sources or moving to alternative materials,” it said, without giving details.

SALZGITTER (SZGG.DE)

Germany’s second-largest steelmaker said it does not source coking coal from Russia and the very low volume of PCI (pulverised coal injection) material that had come from Russia has been replaced. “Thus an import stop would not affect us at all,” the company said.

TATA STEEL (TISC.NS)

The British arm of the Indian steelmaker said it has suspended further shipments of coal from Russia. The company has adequate stocks of raw materials at its Port Talbot steelmaking site and has identified alternative sources for coal. “We are not currently expecting disruption to our ability to produce steel for customers,” it said.

The European unit it had suspended outstanding coal orders from Russia for the coming months and has starting purchasing alternative supplies.

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Reporting by Eric Onstad Editing by Nick Zieminski

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