Mechel Prolongs Coal Contract with China’s Baosteel Resources until 2019
Mechel PAO (NYSE: MTL, MOEX: MTLR), one of the leading Russian mining and metals companies, reports prolonging its cooperation agreement with Baosteel Resources which is part of China Baowu Steel, China’s largest steelmaking group.
The agreement notes long-lasting reliable cooperation between the two sides, based on principles of mutual benefit and trust, guaranteed by stable long-term supplies of coking coal.
The new agreement will be valid for July 2018 to June 2019. During this time, Mechel will supply Baosteel Resources’ facilities with up to 700,000 tonnes of premium-grade coking coal. According to the contract, a major part of this coal — up to 40,000 tonnes monthly — will be supplied by Yakutugol Holding Company AO. The price will be determined on a monthly basis.
“Russian coking coal’s share in Chinese imports is about 7%. Mechel is a chief Russian supplier of high-quality coking coal to China, in 2017 we have shipped two million tonnes of coking coal to our Chinese clients. We have fully met our obligations on our previous contract with Baosteel Resources, which is our longstanding and respected partner. We are glad that our fruitful cooperation continues,” Mechel PAO’s Chief Executive Officer Oleg Korzhov commented.
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