One in five coal companies in Russia may close
Over the next five years, about 20% of Russia’s coal production capacity could be shut down due to the crisis in the industry. This was stated by Alexander Isaev, CEO and co-owner of the Elga Group, which operates the country’s largest coal deposit, the Elginskoye field.
According to him, small enterprises that mine low-quality coal are the most vulnerable. In contrast, large companies with their own coal processing facilities will have a better chance of staying afloat.
Isaev noted that the industry is being pushed toward plant closures by falling demand and coal prices in key consumer countries. Companies in Kuzbass may be hit hardest due to high transportation costs.
According to him, companies are already being forced to significantly cut costs. At the same time, mining itself accounts for only about 30% of total costs, while the rest is attributed to transshipment at ports, maritime transport, and rail logistics. Further cost savings in these areas are extremely difficult to achieve.
Isaev cited Russia’s high key interest rate—currently at 14%—as an additional factor putting pressure on the industry. Due to expensive loans, companies are postponing equipment purchases and investment projects. In addition, the strengthening of the ruble is complicating Russian coal exports.
The Russian coal industry, which employs about 150,000 people, is experiencing its deepest crisis since the 1990s. Following the outbreak of full-scale war against Ukraine and the European Union’s refusal to purchase Russian coal, the industry has faced a contraction in sales markets and a significant increase in logistics costs.
In late March, Russian Deputy Energy Minister Dmitry Islamov stated that the number of unprofitable coal enterprises in the country is rapidly increasing. According to him, 62 enterprises were in a critical situation; of these, 20 had already suspended production, and another 14 had decided to liquidate or mothball their operations.
By the end of 2025, Russian coal companies had incurred a combined loss of 408 billion rubles—a record figure in the industry’s history. Three out of four companies ended the year in the red, and each metric ton of coal mined resulted in an average loss of about 1,000 rubles.
In the Kemerovo Region, Russia’s main coal-mining region, 80% of the industry’s enterprises were unprofitable. The Russian government projected that by 2026, the aggregate losses of coal companies could rise by another 41%—to 576 billion rubles.
Thus, between 2024 and 2026, the Russian coal industry could accumulate more than 1 trillion rubles in losses.
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