In 2018, Belarus became a re-exporter of Russian coal to Ukraine

22 February 2019
Coal shipments from Belarus to Ukraine increased

Belarus does not mine coal. According to Belstat, in 2018 it exported 854 thousand tons of this fuel. It’s five times more than the year before. Such growth was mainly due to transportation to Ukraine, RBC notes.

Coal shipments from Belarus to Ukraine increased from almost zero ( 0.6 thousand tons) to 588.5 thousand tons. Minsk imported twice as much coal as a year before – 1.6 million tons, most of which (1.2 million tons) was imported from Russia, indicates Belstat.

About half of Ukrainian thermal power plants operate mainly on anthracite, which has historically been supplied from mines in eastern Ukraine. Now these mines are controlled by the authorities of the self-proclaimed republics – the Donetsk People’s Republic (DNR) and the Luhansk People’s Republic (LNR).

Earlier it was reported that Donbass coal could be supplied through Belarus, and not only to Ukraine, but also to other countries, in particular to Poland.

In 2017, the LNR leadership claimed it was negotiating with Belarus, Turkey and China on the supply of coal. But then Belarusian Deputy Prime Minister Vladimir Semashko denied buying coal from the self-proclaimed republic. He said that Belarus had a small need for coal – 95% of the Belarusian energy sector runs on gas.

Russian coal miners were forced to resort to indirect coal supplies to Ukraine due to trade restrictions imposed by Russia, a source in the Russian coal company and the general director of another coal company told RBC. “We cannot ship directly, because they do not provide quotas,” one of them said.

According to Belstat, in monetary terms, coal imports to Belarus in 2018 amounted to 107 million dollars, the average price was 65 dollars per ton. Exports reached 74.9 million dollars, and the average price was 87.7 dollars per ton.

In January-November 2018, Ukraine increased imports of coal and anthracite to 2.7 billion dollars which in monetary terms is 11% more compared to the same period last year. The main supplier for that period was Russia, which supplied coal worth 1.67 billion dollars, reported UNIAN.

“The idea to make money on re-export for Belarus is correct,” says Maxim Khudalov, director of the AKRA corporate rating group. “But so far we are talking about insignificant volumes, so one cannot say that in this way Minsk will be able to compensate for the losses from a gradual increase of price for Russian oil due to the completion of the tax maneuver,” he noted.

Minsk assesses its potential losses due to the rising cost of Russian oil at 10.5 billion dollars over six years (until 2024) and asks Moscow for compensation.