The Russian Federal Antimonopoly Service (FAS) has warned domestic coking coal producers against coordinated actions to increase prices, saying that the disseminated information about future price increases could be interpreted as concerted actions resulting in restriction of competition in the coking coal market.
"Lately the media, including internet sites, have been actively disseminating information that Russian companies will be increasing prices for coking coal by 30-40 percent. And the media quote, in particular, producers of coking coal as the sources of the information," reads FAS' statement.
According to such reports, from February this year Evraz's Raspadskaya Coal Company plans to raise its domestic prices of coking coal concentrate (GZh grade) by $30/mt (i.e., by 33 percent) to $120/mt on FCA basis excluding VAT. In Q4 2009, the Russian coking coal producers signed domestic supply contracts until the end of January this year at a price of $90-100/mt (excluding VAT) depending on the grade of coal.
"Given the rising demand (and prices) for coking coal in both the domestic and export markets, we think that other domestic producers may also increase prices by $30-40/mt to $120-130/mt by March-April, with Russian steelmakers likely to accept this increase," analysts at Russia's Uralsib Bank have commented.
This price increase would be the second since the start of the global economical crisis, when coking coal prices reached the bottom. On the first occasion, Russia's coal producers increased their selling prices for coking coal by about 50-60 percent in the fourth quarter of 2009, with Belon's coking coal prices reaching $100-103/mt and Raspadskaya's rising to $90/mt.