Ukraine coking coal imports plunge 40% m/m in June

Ukraine’s imports of coking coal plunged 40% m/m 640
kt in June, according to a July 11 report by Interfax-Ukraine, which cited
Ukrmetallurgprom, an industry association. The 1H19 imports were 5.65 mmt, a 2%
yoy drop.

Recall, in April the Russian government decided to restrict exports of Russian coal,
including coking coal, to Ukraine starting from June 1, allowing such exports
only under permits issued by Russia’s Ministry of Economic Development.

Dmytro Khoroshun: Ukraine
usually imports about 1 mmt of coking coal a month (including about 0.5 mmt
from Russia), and a roughly 35% drop from this level to 640 kt is worrying in
light of Russia’s restriction on its exports to Ukraine.

Although some of the decrease in imports was likely
due to Ukraine’s heavy maintenance program of blast furnaces in June, including at Metinvest (METINV), Russia’s restrictions on coking coal exports into
Ukraine have a potential to depress Ukraine’s iron and steel production volumes
in the coming months.