US Mining equipment manufacturers are increasing market share in Russia

US Mining Technology manufactures are experiencing healthy growth in exports to Russia, with US Congress voting to agree Permanent Normal Trade Relations (PNTR) with Russia and Russia Joining the World Trade Organization (WTO) this is creating  opportunities for mining equipment manufactures to export to Russia.

Russia is the world’s largest country it’s also one the richest mining areas in the world from Iron Ore to Coal, Nickel to Diamonds, Gold to Platinum, Bauxite to Chromium Russia ranks amongst the world’s top 10 for both production and reserves. In 2012 48 Billion USD was invested in the Mining and Metals sector in Russia. Russia has the world’s 2nd largest reserves of Coal and it’s one mining resource that has suffered in the past with a lack of investment but this is changing as it’s been targeted as a key mining sector for improvement. Russian President Vladimir Putin has declared that coal production will increase by 30% by 2030 with overall total investment in this sector up to 1.2 Trillion USD by this date. Russia is seen as the Saudi Arabia of Coal but with less than 5% of global coal production then the potential for growth is enormous. One key market for Russia’s coal will be its BricPartner China as well as other growing Asian economies.  

In 2012 US companies exported $ 720 million dollars’ worth of rock-cutting, drilling, boring, sinking machinery and parts it’s expected that mining equipment exports by US companies will increase by over 30% in 2013. Over the last 10 years US Mining equipment companies have increased their exports by an average of 16% each year. One example of a US manufacturer looking to increase its market share in Russia is Caterpillar which has exported over 2 billion USD worth of products over the last 5 years with Russia now Caterpillar sixth largest market.
 
With the US Normalizing trade with Russia this will ensure U.S companies access to the Russian marketplace and Russia’s accession to the WTO creates new WTO rights which include stronger intellectual property protections, greater transparency, and recourse to the WTO's dispute settlement procedures if Russia fails to meet its commitments. This legislation places U.S. business on an equal footing in securing new sales and contracts, and it creates greater business certainty for U.S. companies seeking to expand in the Russian market.

In total Russia imported $ 320 billion worth of goods in 2012 with US exports only accounting for 5% of this total this is expected to improve greatly for US companies in 2013 with Permanent Normal Trade Relations now being agreed.