One Of Russia's Largest Coal Companies Reported A Collapse In Production To A Minimum

In addition to coal, production is falling in almost all items.

Russian mining and metallurgical holding Mechel, which is in distress due to the crisis in the metallurgy and coal industries, reported the maximum reduction in coal production in recent years, writes RBC with reference to the company's reports. According to the results of the third quarter of 2025, Mechel mined 1.28 million tons of coal, which is 16% less than in the previous quarter and 55% less in annual terms (2.89 million tons were mined in the third quarter of 2024). For comparison: in 2013, the company took 6.4 to 7 million tons of coal out of the ground every quarter. According to Mechel's previous reports, in 2009, 3-5.4 million tons were mined every quarter. In the first quarter of 2004, the figure was 3.6 million tons, and a year earlier - about 3.4 million tons.

But in the first nine months of 2025, the production volumes collapsed by 38% year-on-year to 4.93 million tons. During the same period of 2015, Mechel, according to the company's data, produced 17.4 million tons of coal. Such indicators of coal production became the lowest for at least 10 years, and the rate of decline in production - the maximum, confirm the BCS, noting that Mechel's production volumes turned out to be worse than expected. Over six months, the annualized decline in coal production was 28% (to 3.66 million tons), according to the company's summer report.

Mechel's production, in addition to coal, fell in almost all items, including pig iron output (down 5% year-on-year), steel (-2%) and thermal energy (-7%). Sales also declined in all but one item (iron ore concentrate). Sales of PCI coals (-67%), anthracites (-43%) and stamped products (-41%) sagged the most.

Mechel CEO Igor Khafizov cited "shrinking sales markets and low price environment" in the market in the 9-month report. He added that the company is focusing its efforts on producing products with higher margins.

Mechel Igor Zyuzin's Mechel, which has been under US sanctions since February 2024, reported a 2.4-fold increase in net loss in the first half of 2025 in August. At the end of January-June, it reached 40.5 billion rubles, becoming the maximum since 2015. Revenue fell by 26% to 152.3 billion rubles, EBITDA - by 83% to 5.7 billion, which corresponds to multi-year lows.

An industry source previously told Reuters that against the backdrop of negative performance, Mechel this summer carried out staff cuts. The company has not commented on this information.

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