The largest exporters stopped transshipping coal at the OTEKO terminal due to high tariffs
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The conflict between coal companies and the OTEKO terminal in Taman is growing: according to Kommersant, the largest exporters refused transshipment in February, citing a high tariff. OTEKO says the opposite, saying that applications for transshipment of 4 million tons of coal were submitted for February. According to Kpler, seaborne shipments of coal from Taman stopped in late January and early February. Coal miners insist on reducing the tariff due to falling coal prices, while a number of players agree to increase the tariff if market conditions improve.
Coal companies are withdrawing February requests for coal transshipment through the OTEKO terminal in Taman due to too high transshipment tariffs, three industry sources told Kommersant. In 2023, Taman became the fourth Russian port for coal shipments after Ust-Luga, Vostochny port and Vanino. However, according to Kpler, during the period from January 22 to February 4, not a single bulk carrier with coal left Taman.
OTEKO — operator of two marine terminals in Taman, bulk and liquid. The company calls itself the largest private investor in the port and industrial infrastructure of the south of the Russian Federation. The owner of the group is Michelle Litvak. According to NEFT Research, major clients of the OTEKO terminal in 2023 were SDS-Ugol, Sibanthracite, Kuzbassrazrezugol, SUEK, Stroyservis, TalTEK, Raspadskaya.
Raspadskaya officially confirmed to Kommersant that they will not make shipments through OTEKO in February. Also, according to Kommersant, Sibanthracite, Kuzbassrazrezugol and SUEK do not make shipments. One of Kommersant’s sources among coal companies claims that in February not a single company showed up for transshipment in Taman.
The OTEKO press service denies this: “During the period of placing applications in the Russian Railways ETRAN information system, requests were submitted for transshipment of more than 4 million tons of coal through the port of Taman. We are currently negotiating with cargo owners on the terms of service. Transshipment at the terminal itself continues despite the ongoing modernization program.”
Coal companies are dissatisfied with the level of OTEKO tariffs, which, according to Kommersant’s interlocutors, makes shipments unprofitable. “The transhipment rate is significantly higher than what the terminal calls $24.5 per ton. $24.5 per ton is the base rate offered for the cheapest thermal coal. OTEKO contracts hide various increasing coefficients and fines, and taking into account the constant downtime of the fleet during loading and increased “military” insurance, the final cost of transshipment increases by $10–20. For more expensive grades of coal, the base rate starts from $38 per ton and ultimately exceeds $42 per ton,” notes a Kommersant source on the coal market. Coal companies, he said, would like to meet with OTEKO owner Michel Litvak and discuss tariffs with the participation of the government.
Another Kommersant source in one of the largest coal companies says that it was decided to withdraw the application for February after it was not possible to agree on an effective transshipment rate. “This is purely a matter of economics. In our opinion, in the context of negative dynamics on the global coal market, Taman is not competitive with other terminals in terms of the size of the proposed transshipment rate,” he notes. According to him, the company made an official proposal to revise the rate, but there was no official response from OTEKO.
Some coal companies are ready to share the export margin with the terminal, but subject to its availability. “We are ready to pay a higher rate if the coal market grows, but during a correction we expect a corresponding decrease,” says Kommersant’s interlocutor. According to him, now when calculating OTEKO transshipment rates, indices are used that “have no relation to Russian coal.” “According to our data, the estimated transshipment rate in February, taking into account the Taman formula, does not differ from the rate in January and almost corresponds to the December level, although during this time the market has adjusted significantly,” he noted.
If coal companies must focus on operational trends (price, discounts on Russian coal, the situation in purchasing countries), then to ensure return on investment in the construction of terminals, a long-term understanding of income and expenses is necessary, comments the head of Infoline-Analytics, Mikhail Burmistrov. Perhaps, he believes, within the framework of a ship-or-pay agreement, a certain component of the transshipment tariff can be tied to coal prices, but only a small part.
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