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Mechel Signs Additional Contracts for Coking and Steam Coal

06/29/2009 - Mechel OAO has signed contracts for coking and steam coal supplies to Chinese, Japanese, and South Korean companies for 2009 as part of is ongoing effort to enlarge the geography of coal sales.

Mechel OAO has signed contracts for coking and steam coal supplies to Chinese, Japanese, and South Korean companies for 2009 as part of is ongoing effort to enlarge the geography of coal sales.
 
Building on its successful experience of coal supplies to Japan and South Korea, in 2009 the company also entered the Chinese coal market, signing a number of large new contracts with local customers. The company has already commenced supplies of coking coal concentrate produced at Yakutugol and steam coal of various grades to China.
 
“China is a very promising market for us,” commented Mechel OAO Senior Vice-President Vladimir Polin. “Its steel industry continues to develop fast, resulting in stable high demand for our commodities: iron ore concentrate, coking coal concentrate, and ferroalloys. Moreover, signing of the new contracts provided us with the opportunity of deeper understanding of the Chinese market and we continue the activities to enter into new agreements.
 
“It is important that supplies to China are performed by both water transport and along railways, thus the flexibility of supply chains makes additional competitive advantage for us,” added Polin. “I would like to emphasize that entering into new large contracts with Chinese companies allows us to increase the load of our coal mining facilities -- that is of particular importance in the current challenging business environment,” he concluded.
 
Mechel’s total volume of supplies for fiscal year 2009 under its contracts with Chinese, Japanese, and South Korean companies now amounts to approximately 2 million tons of coking coal concentrate produced at Yakutugol and 2.3 million tons of steam coal of various grades produced at Yakutugol and Southern Kuzbass.
 
Since 2007, Mechel has also been selling to China iron ore concentrate produced at its Korshunov Mining Plant.
 
Mechel, one of Russia’s leading companies, unites producers of coal, iron ore concentrate, steel, rolled products, ferroalloys, nickel, hardware, heat, and electric power. Its business includes four segments—mining, steel, ferroalloys and power—and its products are marketed domestically and internationally.