Ulaanbaatar /MONTSAME/ During the ‘Coal Mongolia-2018’ conference on September 4, Mining Minister D.Sumiyabazar emphasized the opportunity to increase annual coal exports from 20 million tons up to 30 million. He also noted that the competitiveness is a key factor and the use of advanced technology will increase the productivity and reduce costs.
In his opening remarks, Minister D.Sumiyabazar said that Mongolia has extracted 26 million tons of coal as of July, 2018. Compared with the same period of the previous year, the coal mining was decreased by one percent; however, the revenue was increased by MNT 753 billion. The Minister emphasized that mining sector, especially coal mining, remains a major part of Mongolia’s foreign trade and exports.
Mr. Yang Xianfeng, President of China Coal Transportation and Distribution Association and General Director of Economic Operation Department at ‘China National Coal Association’, delivered an opening remarks. He said, “In 2017, China imported 271 million tons of coal and is cooperating with many countries in coal market including the US, Australia, Russia and Mongolia. The global energy consumption is moving towards smart solutions and entering a new phase. Thus, the coal importers are facing the challenge of improving their technologies and coal quality. China's energy structure is being updated thanks to the Government’s efforts in intensifying coal imports and improving coal quality. Enhancing the relationship with China's energy sector will strengthen cooperation between China and Mongolia. Let’s bring the economic and trade exchange to a new level.” Mr. Yang Xianfeng also noted that Mongolia is the second major coal exporter of China after Australia. “Until now, Mongolia exported only coking coal, but now it is good that it starts exporting another variety of coal anthracite,” he added.
Interim State Secretary of the Ministry of Road and Transport Development R.Mergen delivered a presentation themed ‘Current situation of the transportation policy and planning of mining production’. “In 2015, Mongolia exported 15 million tons of coal. Since then, it is constantly growing. As of July, 2018 it has reached 21 million tons. Some 10 thousand out of total 14 thousand heavy trucks are transporting coal in Tavan Tolgoi-Gashuun Sukhait route, which shows that Gashuun Sukhait is the main gateway of coal export. In order to export coal to the Far East, it was decided to construct a railway in Tavan Tolgoi-Zuunbayan route under the concession agreement and negotiations are ongoing. The railway is 460 km long and costs USD 1.1 billion. Also, It is necessary to construct a railway from Tavan Tolgoi-Zuunbayan to Khangi mandal,” he noted.
In his presentation ‘Unexpected opportunity for Mongolian coal?’ CEO of Energy Resources LLC G.Battsengel noted that the coal market intensified in 2008-2009, but coal prices fell down in 2011-2012. The price tended to recover in 2015-2016. “It’s obvious that the coal market is recovering. We shouldn’t waste the second chance. Mongolia exports mostly coking coal to China, which is used for its metallurgical and steel industries. China produces 50 percent of the world's steel consumption alone. Thus, it has the highest coking coal consumption. China’s coking coal consumption remains stable. As you can see, the volume of coal imports are also limited. We are losing USD 40 million annually due to insufficient port access. For last two years, when the coal prices were high, it imported coking coal from Indonesia and Australia. The coking coal price has doubled in the first half of 2018, compared with the 2016 and 2017. China is pursuing a policy of removing excess coal and developing green economy. Coal consumption of Chinese steel industries varies in its regions and provinces. Hebei province used to produce over 190 million tons of steel annually. Currently, the production was reduced due to air pollution. In 2017, coking coal production of the province was reduced by 9 percent and Inner Mongolia’s production was increased by 10 percent,” he noted.
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