Mining Ministry: Mongolian coal is forced out of big market

Ulaanbaatar /MONTSAME/ Coal export, which makes up 40 percent of total export of Mongolia, has declined from 36 percent to 17 percent this year as big coal exporters, or the rivals of Mongolia, are increasing at China's market. The Vice Minister of Mining O.Erdenebulgan Wednesday emphasized it at a conference themed "Transparent Mining". He said their Ministry admits that the Mongolian coal is being forced out of the Chinese market due to several factors such as the European crisis, economic depression in China, and coal export to China from Australia, Indonesia and new ones like Russia, Colombia and Mozambique. Apart of this, a poor development of the transportation makes the problem harder to solve, he added. The Ministry says it is time to become a strong competitor at the coal market--by the quality, not by prices. A first step would be a constructing of a railway by the year 2015 because the coal transportation by auto road is very expensive. Another good news is that "Erdenes Tavantolgoi" company is to put into use a coal washing plant, he said. Then he mentioned about a bilateral trade and cooperation meeting between Mongolia and China early month in Hohhot, Chinese Inner Mongolia, saying that the gathered had released an appeal with a clause on establishing an intergovernmental long-year and sustainable strategic agreement and on creating a legal environment for coal export, implying that some negative factors must not repeat such as a deal between Mongolia and Chalco (Aluminum Corporation of China Ltd), which caused a debt dispute. For the time being, Mongolia shall pay USD 170 million to the Chalco, also it is possible to pay the debt off after supplying 3.6 million tons coal to China at a price of USD 47 per ton. The conference also touched upon an export of concentrate by the Oyu tolgoi LLC. According to the latter, the concentrating plant has a capability of processing 100 thousand tons of ore a day, and is planning to process 36 million tons a year and to export one million tons of copper concentrate. But this company refuses to give information about date of the export, about buyer and prices, he said.