Russian miner Mechel OAO (MTL) recently announced that the Trade Port Posiet has attained 5 million tons of annual cargo volume of coal products by Dec 25. This was by far the best cargo report in the port’s history. Coal shipment with 5-millionth tonne of coal was dispatched to the People's Republic of China.
Trade Port Posiet, situated on the Japanese Sea coast, south of Vladivostok, handles coal supplies to Pacific Asia. The port is part of the logistic wing of Mechel.
The record achievement by Trade Port Posiet came on the back of the launch of a trial run of a specialized coal terminal in the first quarter of 2014. Moreover, two wagon dumpers are used to dump coal, speeding up the transshipment to almost double. Thus, the company now expects the port to achieve a capacity of 7 million tons of coal by 2015.
Additionally, the port is set for an infrastructure upgrade including the construction of a sea terminal and an approach channel for Panamax-type vessels with cargo capacity of up to 60,000 tons. This will help the port boost its turnover to 12 million tons of coal in the mid-term.
Mechel recently posted third-quarter 2014 results. The company incurred a net loss (as reported) of $575 million for the third quarter of 2014, wider than a net loss of $127 million recorded in the third quarter of 2013, affected by a significant plunge in coal and iron ore prices.
Revenues for the third quarter came in at $1,588 million, down about 24% from $2,089 million in the year-ago period. Sales were also down 9% sequentially.
Mechel is focused on the development strategy approved by its board of directors in May 2012. This includes concentration on core business segments, divestment of non-core assets and improvement of the Group's key enterprises’ performance.
Mechel, a Zacks Rank #2 (Buy) stock, is a leading steel and coal producer along with its peers like Nucor Corporation (NUE).
Other steel companies worth considering include Kobe Steel Ltd. (KBSTY) and United States Steel Corp. (X). While Kobe Steel sports a Zacks Rank #1 (Strong Buy), United States Steel carries a Zacks Rank #2.
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