The European Union’s industrial sector continues to face challenges as a result of the ban on Russian coal implemented last year, according to Russian Deputy Energy Minister Sergey Mochalnikov. He made this statement during the Eastern Economic Forum (EEF), highlighting the difficulties the bloc has encountered in finding alternative coal sources and dealing with quality issues.
Mochalnikov criticized the EU for rejecting Russian energy, including gas, oil, and coal, and believes this is causing the systematic destruction of the bloc’s industry. He explained that although coal consumption in the EU has increased, the reliance on non-Russian suppliers has made it harder for them. The EU’s production processes were originally tailored to the quality of Russian coal, and now they have to readjust their technological processes when buying coal from Africa, Latin America, and Asia.
He further revealed that most of the coal supplies that were redirected following the EU ban went to China and India. China imported 67 million tons of coal from Russia in 2022, a significant increase from just over 50 million tons in 2021. Similarly, India nearly tripled its coal purchases from Russia, importing more than 20 million tons last year.
Mochalnikov emphasized that Russia successfully reoriented its markets towards the east. However, sanctions have undoubtedly affected Russia’s energy industry, as companies had to adjust to new partners, logistics routes, and longer delivery times. They also faced challenges with insurance, as the sanctions encompassed not only coal but also services related to its exports. Despite these obstacles, Mochalnikov expects the coal industry to end 2023 in good shape.
The EU’s ban on Russian coal was implemented as part of its fifth package of Ukraine-related sanctions against Russia. Before the ban, Russia accounted for approximately 45% of the bloc’s coal imports, with Germany, Poland, and the Netherlands being the largest purchasers. The ban has forced the EU to seek alternative suppliers and adjust its production processes accordingly.
In conclusion, the ban on Russian coal has had a significant impact on the European Union’s industrial sector. While Russia has successfully redirected coal supplies to China and India, the EU has struggled to find alternative sources and has had to adapt its production processes to accommodate non-Russian coal. The sanctions have presented challenges for both Russia and the EU, but Mochalnikov remains optimistic about the future of the coal industry.