FAS: THE LARGEST COAL COMPANIES MUST SELL AT LEAST 10% OF COAL ON THE STOCK EXCHANGE FROM THE VOLUME OF ITS SALE TO THE DOMESTIC MARKET

A joint Order of the FAS Russia and the Ministry of Energy of Russia on the setting of a minimum standard for sales of D and DG grades of thermal coal at exchange trading has been registered

It applies to companies that have a dominant position in this commodity market.

The Authority notes that the Russian Federation is the first country in the world to adopt this mechanism.

The first trades of coal within the framework of the pilot project at the Saint Petersburg International Mercantile Exchange (SPIMEX) began in December 2019.

It provided for the sale of coal grade D. In May 2020, market participants had the opportunity to conclude deals with sixteen new exchange-traded coal products.

According to the Authority, the sale of coal products through the exchange will ensure more transparency in the formation of prices for this product due to the fact that companies have a dominant position will be on an equal footing with other market participants.

At the same time, anonymity and digitalization of transactions on the exchange will exclude the possibility of coal companies forming economically unreasonable prices and reduce the number of intermediaries.

Thus, the measures taken will significantly improve the efficiency of coal trading on the commodity exchange, create market indicators and conditions to ensure transparency of concluded transactions for the supply of coal products.