The recently renewed tension between Russia and Ukraine has resulted in restricted exports of coal and oil from May onwards.
Russia is planning to increase export duty on met coke to Ukraine. The expected export duty for Russian coke will be increased to USD 6.70/MT from 6.30/MT according to the Russian finance ministry. However, the previous duty hike which occurred last month rose from USD 5.90/MT.
It is to be noted that these trade barriers with Ukraine are in response to the country’s recent restriction imposed on Russian products such as glassware and electronic equipment etc. Increase in met coke export duty can be considered as the response for retaliatory measures or continued diplomatic tensions between both countries.
In a recent meeting held with Russian Prime Minister – Dmitry Medvedev, he mentioned that “Under these restrictions, Russian exporters will need the special government permits to continue exporting coal and oil to Ukraine. As trade relations are going unfriendly with Ukraine, we have to defend our interests and take the same retaliatory measures”.
Encountering above, the Ukrainian Cabinet of Ministers also took another unfriendly step towards Russia, expanding the prohibited list of Russian goods which the country use to import.
It’s been a decade, both the countries were facing a breakdown in relations. But recent breakdown emerged over Moscow’s annexation of the Crimean peninsula and backing for separatists in eastern Ukraine. Trade turnover fell by more than two-thirds in the years after 2014; however, it fell further after Russia suspended a free trade zone with Ukraine after Kiev entered into a free trade zone with the European Union entered in 2016.
Russia is the largest exporter of coal to Ukraine. According to SteelMint Statistics, in 2018, Russia exported 8.93 MnT coking coal, in 2017 it was 6.11 MnT and in 2016 it was around 7.22 MnT to Ukraine. Exports of met coke from Russia remained at 0.77 MnT in 2018, 0.85 MnT in 2017 and 0.44 MnT in 2016 to Ukraine.
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