Coal market of the Black and Azov seas

Elena UlyanovaAnalyst of coal and metallurgical markets

“Black Sea Freight Market & Ports 2008”June 5 -6, Odessa, Hotel “Odessa”

World seaborne coal trade

Coal prices reached historically highest level

Reasons

- growing demand for raw materials - disbalance of coal demand and supply at the turn of the 2007 year

- high freight rates in the Atlantic and Pacific markets

- China’s coal export is falling down

Average prices of coking coal

Average prices of steam coal Europe Market Asia Market

Coal export from CIS countries

During last 5 years export of coalfrom the CIS countries has increased in 1.5 times to 129 million tons

About 65% of coal export is shippedvia sea ports

Russia is the main coal exporter:in 2007 export of coal grown up to98 million tons

CIS. Seaborne coal trade2007 year

2006 year

Coal shipments via CIS & Baltic ports

2007

2006

Coal shipments via CIS & Baltic ports2006-2008 years

Goods turnover in Ukrainian sea ports

2007

2006

Goods turnover in Russian southern ports

2007

2006

Coal shipments via Black & Azov sea ports

-5%5 3025 56512%21 77419 512TOTAL

4%1 4801 42040%5 9044 203Total 2

-2050%32Ust'-Donetsk

-44%59110%6129Rostov

-44%77138148%693279Taganrog

-33%10014952%693455Eysk

-1870-200Temrjuk

-1%361366403%1 564311Azov

-1%748758-8%2 8703 127Tuapse

-8%3 8224 1454%15 87015 309Total 1

-00-100%081TransInvestServise

-00-100%0333Il'ichevsk

-00-330TIS-Ruda

-280-00Kherson

-87%1713383%605331Odessa

-8%3740-54%74161Sevastopol

-33%163244-21%8131 031Berdyansk

101%31615746%596408Reni

9%4203856%1 6861 593Kerch

-53%5711 223-18%3 9034 751Yuzhny

6%66062115%2 1221 852Izmail

-20%7809758%3 6553 382Mariupol

126%83036772%2 3831 386Nilolaev

% changeIQ 2008IQ 2007% change20072006

-5%5 3025 56512%21 77419 512TOTAL

4%1 4801 42040%5 9044 203Total 2

-2050%32Ust'-Donetsk

-44%59110%6129Rostov

-44%77138148%693279Taganrog

-33%10014952%693455Eysk

-1870-200Temrjuk

-1%361366403%1 564311Azov

-1%748758-8%2 8703 127Tuapse

-8%3 8224 1454%15 87015 309Total 1

-00-100%081TransInvestServise

-00-100%0333Il'ichevsk

-00-330TIS-Ruda

-280-00Kherson

-87%1713383%605331Odessa

-8%3740-54%74161Sevastopol

-33%163244-21%8131 031Berdyansk

101%31615746%596408Reni

9%4203856%1 6861 593Kerch

-53%5711 223-18%3 9034 751Yuzhny

6%66062115%2 1221 852Izmail

-20%7809758%3 6553 382Mariupol

126%83036772%2 3831 386Nilolaev

% changeIQ 2008IQ 2007% change20072006

Coal shipments via Black & Azov sea ports

Export rail transportation of Russian coal to southern ports

Coal turnover in Ukrainian sea ports

Southern sea ports’ capacitiesin coal shipments

Directions of coal deliveries from Black and Azov sea ports

2007

2006

What are we expecting?..

Coal turnover of the Black and Azov seaports will remainat 22 million tons in 2008

Increasing of export coal transportation in own rail carswill push up FOB prices

Turkey’s coal demand is growing