News dynamics

According to information released by the CCA Analysis website on March 31, the Russian coal industry is experiencing an unprecedented systemic crisis.Data show that 27 coal mining companies in Russia (involving a total production capacity of 40 million tons) are facing an existential crisis, and the total coal production of loss-making companies is as high as 126 million tons.

The proportion of loss-making companies in Kuzbass, Russia's core coal-producing region, has soared from 34.8% in 2023 to 57.3% in 2024. At present, 50% of companies in the Republic of Khakas are at a loss (there has been no loss in 2023).

Local finances have been hit hard.The tax revenue of Kuzbass coal companies fell by 53% (US5554 million), and the tax revenue of Hakas shrank by two-thirds (to US226 million).

As of March 2025, the arrears of wages in the Kuzbass coal industry reached US44.1 million, 9 companies have ceased production, and 20 are on the verge of shutdown.

Due to the decline in global coal prices, the profitability of coal mining is still lower than the cost of production.The Far Eastern route is overloaded, while the western and southern directions require large-scale logistics investment.

The collapse of companies in coal-producing areas, the sharp deterioration of financial performance, and the intensification of social tensions require companies and governments to respond immediately.

Key industry challenges

| Price and cost are upside down: global coal prices continue to fall, but mining costs continue to rise due to the appreciation of the ruble (+transportation costs account for 50%)

| Logistics bottleneck: The transportation channel in the Far East is overloaded, and there is an urgent need for US2200 billion in infrastructure investment in the western/southern direction.

| Financial tax pressure: the high benchmark interest rate (currently 15%) overlays rigid expenditures such as resource extraction taxes and insurance costs.

| International payment barriers: SWIFT sanctions have made it difficult to make export refunds, and new channels have not yet been opened up after the loss of the traditional European market.

In order to save the coal industry, the Russian Ministry of Energy is considering an anti-crisis plan for coal mines. The government's emergency rescue plan includes the following support measures：

【Transportation subsidy system】

• Railway tariff freeze: suspension of rate increases by Russian railway companies before the end of 2025

• Targeted freight discount: Westbound transportation enjoys a 12.8% rate discount, and the air mileage rate is reduced by 10%

•Long-term control mechanism: implement the "inflation rate -0.1%" tariff formula by 2035

【Financial and tax financial support】

• Debt rollover for 6-24 months + interest rate subsidy (covering 2/3 of the base interest rate)

• Special financial support: China Development Bank provides liquidity loans with an annual interest rate of 10%

• Tax holdover: mineral resources tax and social security payment are postponed for 12 months

【Geo-economic breakthrough】

• China-India strategic cooperation: promote the abolition of import tariffs and establish a special channel for local currency settlement

• Support for single-industry towns: special bonds for infrastructure transformation + joint financing of social projects

Benefit assessment and risk warning: Calculations by the Ministry of Energy show that if production capacity is allowed to shrink, the economic loss will be twice as high as the cost of rescue.Although the plan can stabilize 500,000 jobs and the basic situation of the regional economy, the core contradiction is still unresolved-the current global thermal coal price (about US885/ton) is lower than the average production cost of Russian companies (US992/ton).

Expert recommendations need to be promoted simultaneously：

Digital mine transformation (expected to reduce mining costs by 15%)

Extension of the coal chemical industry chain (increase in added value by more than 30%)

Arctic waterway development (shorten the transportation cycle of the Asian market by 40%)

The crisis is essentially a concentrated outbreak of Russia's lagging energy transformation and excessive dependence on traditional export models. Its solution effect will profoundly affect the evolution of the Eurasian energy landscape.