Despite Putin’s December call for emergency action to save Russia’s coal industry, today, the Governor of the largest coal producing region in Russia sounded the alarm, explaining that with “many enterprises having ended the past year with losses, the question of the industry’s survival as a whole is now at stake,” Governor of the region of Keremova, Seredyuk wrote on his Telegram channel.
The coal industry in Kuzbass, Russia’s largest coal-mining region, is facing an unprecedented crisis that threatens its survival, according to Kemerovo region Governor Ilya Seredyuk. The region, which produces 60% of Russia’s hard coal and nearly 80% of its coking coal, has suffered massive financial losses, raising serious concerns about the industry’s long-term viability.
Seredyuk, in a statement on his Telegram channel, acknowledged that the coal sector is struggling with severe economic difficulties. Many coal enterprises ended 2024 in the red, and the industry as a whole is now at risk. Due to mounting financial pressures, coal companies are finding it increasingly difficult to supply coal to local populations. Without higher coal prices, companies willy be unable to pay miners’ wages, fulfill tax obligations, or settle debts with suppliers.
Government statistics paint a grim picture. Rosstat reports that from January to November 2024, Russia’s coal industry suffered a balanced loss of 68.7 billion rubles ($711,000,000). This is a staggering reversal from the 413.3 billion rubles in profit recorded in the previous year. Nearly half of all coal enterprises are now operating at a loss.
Sanctions have severely curtailed Russian coal exports, cutting off access to key foreign markets. In 2024, coal exports fell by 17 million tons, pushing industry volumes back to their lowest levels in six years. The Kuzzbass region alone saw a drop -7.3% drop.
Several coal mines in the region have been forced to shut down. Among them, Olzherasskaya Novaya has been closed for six months, while Salek, Chernokaltansky, Pervomaisky, and Sibcole Management Company mines remain indefinitely halted. The economic impact of the downturn has been severe: the Kemerovo region now ranks among the top five Russian territories with the largest declines in budget revenue, posting a -13% drop in government income between January and September. Only the newly annexed regions and Sevastopol fared worse.
The gravity of the crisis has prompted more calls for urgent government intervention and international negotiations. Andrey Panov, Deputy Governor and Chairman of the Regional Government, stressed the need for diplomatic efforts to ease trade barriers. He urged Russia to negotiate the removal of Chinese import duties on Russian coal, as China remains a crucial market for exports. Additionally, he highlighted the need for new financial mechanisms to facilitate payments through Chinese and Indian banks, which have become restricted due to Western sanctions.
“If the crisis in the coal industry persists, the economic and social consequences for coal-dependent regions will become severe,” Panov warned.
Reacting months too late for any efficacy remedying the situation, Vladimir Putin instructed the government in late December to urgently develop measures to stabilize industry. As the situation continues to worsen, the Ministry of Energy’s state analytical center, now warns that mass bankruptcies are imminent imminent without swift action.
The coming months will be critical in determining whether the Russian coal industry can survive its worst financial crisis in decades. With mounting losses, declining production, and shrinking export markets, the sector’s future remains deeply uncertain and with coal still 7.4% of Russia’s total exports, very dark days are likely ahead.
We previously warned of the coming collapse of Russia’s coal industry HERE and HERE.