Coal Energy coal production falls 10% m/m in July

Coal Energy reported coal mining at 53.6 kt in July (-14.6% m/m, -66% yoy) and coal production from waste dumps at 13 kt (+15.8% m/m, -44.7% yoy). Thus, total coal production decreased to 66.6 kt in July (-10% m/m, -63.5% yoy).

Roman Topolyuk: The company’s declining production is a result of weak domestic and export markets for coal. Coal stockpiles in Ukraine decreased 11.5% m/m to 4.6 mmt in July, though remained 12% higher than a year before. At the same time, thermal power plants have been reducing coal consumption, by 8.4% yoy in 6M13. We expect any recovery in Coal Energy’s coal production won’t begin earlier than 4Q13.