Batmunkh Batkhuu: We need to create a reserve without halting coal mining
1 сар, 1 долоо хоног өмнө
Domestic coal export companies have faced great challenges these days. One of the representatives of those companies, Batmunkh Batkhuu, Chairman of Big Mogul Fund, emphasized that as a mining dependent nation, the government of Mongolia should pursue trade policies and implement a program to support private sectors. Additionally, he noted that companies need to stock up coal during the quarantine.
-Big Mogul Fund exports coal through the border crossing in Zamiin-Uud. How did China's procurement affect the import of Mongolia?
-Currently, the ports of Erlian and Zamiin Uud have not been suspended for export and import transportations. However, restricting the movement of citizens tend to affect export. We were planning to export nearly 300,000 tons of coal concentrate this year however, the situation is unpredictable as China’s economy continues to shrink.
-The researchers believe that imports will increase significantly to recover the industry loss when the Covid-19 stops. How does your company estimate the risk?
-China’s economy has not been collapsed with decline in both supply and demand before. The country’s supply and demand had declined simultaneously. As of today, China is the largest exporter in the world and the second-biggest importer. It seems that economic conditions are being measured as with the SARS, which happened about ten years ago. But at that time, China’s economy was much smaller than it is now and its impact on the global economy was negligible. Also, China’s large labor force migrates through Wuhan, from north to south. The cessation of millions of labor migration has made it impossible for a coastal industrialized zone to be restored quickly.
-How long do steel factories and power plants take to restore after infection ends?
-Our company is a thermal coal exporter. But we are not big enough for China’s market. It is impossible to live without electricity so that the industry is likely to be recovered quickly.
-After quarantine, how will the commodity price effect on the regular operation of the plant?
-Obviously, it positively affects commodity prices and creates growth. Thus, we have to prepare the amount of material reserve.