Mechel PAO, one of the leading Russian mining and metals companies, has reported extending the year-long coal supply contract with STX Corp., one of South Korea’s major universal trading companies active in Asia Pacific.
According to the document, until December 2021 Mechel will supply STX Corp. with up to 1 million t of products, including metallurgical and thermal coal produced by Yakutugol Holding Co. and Southern Kuzbass Coal Co. STX Corp. will provide funding for coal supply to Asia Pacific. The price will be determined based on the market situation.
Over the past year, Mechel has shipped a total of 800 000 t of coal to STX Corp. as per the current contract.
“The coal market has begun recover after a difficult first half of the year. As several think-tanks have foretold, as demand is getting stronger, prices for metallurgical coal (key product for Mechel’s mining division) may go up by a quarter in the next year and a half. In this sense, 2021 will be indicative. By signing this agreement, we have begun preparing for the next year in advance, as the current situation calls for flexibility in one’s sales policy and offering one’s partners mutually acceptable cooperation aiming for a long-term outlook,” Mechel PAO’s CEO, Oleg Korzhov, commented.