Russian thermal coal export prices could fall 10–20% by the end of 2028

Supply recovery points to lower prices

Russian thermal coal export prices are expected to decline over the next several years as supply conditions improve in the global market. By the end of 2028, prices could remain 10–20% below their June levels, with the scale of the decrease varying by export destination, according to a Neft Research forecast cited by Kommersant.

The forecast follows a period of stronger prices caused by several simultaneous disruptions. The conflict in the Middle East drove oil and gas prices higher, increasing support for competing fuels. Coal production restrictions in China and interruptions to shipments from Colombia, South Africa and Indonesia also tightened the market. As a result, Asian coal benchmarks reached their highest levels since 2024.

Those conditions began to ease in July. Comprehensive safety inspections at Chinese mines were completed, allowing production constraints to loosen. Indonesian suppliers also started adapting to new operating conditions. Neft Research expects these developments to create a market surplus and put downward pressure on prices across fuel categories.

Russian exporters face tight margins

For Russian producers, lower international prices would compound existing pressure on export profitability. Companies already have to offer discounts, while high infrastructure costs reduce the net revenue available from overseas sales. The impact differs significantly by export corridor because transport expenses determine whether a shipment remains commercially viable.

Nikanor Khalin, senior metals and mining analyst at Euler, said that even at current prices coal producers in the Kemerovo region, Russia’s principal mining area, earn a profit only when shipping through the Far East. This makes the industry particularly exposed to any decline in Asian prices or increase in logistics costs. Producers without access to the most advantageous routes may face an even narrower margin between export revenue and delivery costs.

Russian thermal coal delivered to China had already fallen by $5.3 per tonne in the week through July 3, including freight. The weekly movement illustrates how quickly changes in regional supply expectations can feed into delivered prices, although it does not by itself establish the longer-term trend projected through 2028.

Near-term support has not disappeared

Evgeny Grachev, director of the Center for Price Indices, said elevated prices could persist in the coming months because uncertainty in the Middle East remains and supply issues have not been fully resolved. His assessment indicates that the expected multi-year decline may not be linear: geopolitical risks and temporary production or shipping disruptions could still produce periods of stronger prices.

Russian coal exports are rising despite the pressure on profitability. Shipments increased by 4.7% in the first five months to 85.1 million tonnes. The combination of higher volumes and weaker prospective prices presents producers and traders with a difficult balance. Maintaining export flows can support mine utilization, but discounted sales and expensive infrastructure may limit the financial benefit of additional tonnage.

For Asian buyers, improving supply from China and Indonesia could strengthen purchasing leverage and expand competition among exporters. For Russian suppliers, the central issue through 2028 will be whether transport efficiency and access to Far Eastern routes can offset the projected 10–20% price decline. The outlook therefore depends not only on global coal availability, but also on the cost of moving Russian material to the markets where sales remain profitable.