Coal Energy coal production dips 1.4% mom in September

Coal Energy (CLE PW) reduced coal mining by 2% mom in September to 155.9 kt, keeping coal production from waste recovery stable at 41 kt, according to a release yesterday. The decrease was driven by a 11% mom decline in coking coal mining to 22.4 kt, since other segments remained flat. During the first quarter of its 2013 financial year (started in July), the company increased mining by 22% yoy  to 473.3 kt and waste reprocessing by 137% to 123 kt, bringing total coal production up 35% yoy to 596 kt.   

Roman Topolyuk: The exact reason for the decrease in coking coal mining in September is not fully clear yet. We believe the reason mostly likely can be attributed to the weak market. Coking coal prices have fallen 17% since the beginning of July, and there is no evidence of a reversal, with the local steel industry continuing to operate at low capacity utilization (around 70%), and high coking coal imports to Ukraine (up 16% yoy in 8M12).