Russia’s Asbestos Cash Cow under Threat?
As global demand collapses and competitors crowd into remaining markets, the Russian asbestos behemoth is weakening.1 Western sanctions imposed following the invasion of Ukraine are exacerbating an already difficult situation with the country’s largest asbestos conglomerate complaining that it had lost “almost a billion rubles in 2022” as a result of a 5-fold decrease in sales volume.2 Even in India, the world’s biggest asbestos user and Russia’s most important customer, “the key players [in the asbestos sector] are moving towards de-risking their business profiles” by transitioning to asbestos-free technologies.3 At the same time as Russia’s traditional customer base is disintegrating, competitors in Kazakhstan and China are developing new trade routes and streamlining logistics to capitalize on the woes of Russian suppliers.4
There is no question that Russia remains and will remain the world’s largest supplier of asbestos fiber for many years to come. A rough and ready analysis undertaken for this article using data from the United States Geological Survey (USGS), however, showed that the dominance of Russian asbestos suppliers was on a downward trajectory; between 2020 and 2023, the significance of output from Russian chrysotile (white) asbestos mines fell each year: from 66% of global production in 2020 to 48% in 2023.5 Whilst the USGS asbestos trade data is reliably unreliable, nevertheless the apparent fall in production must be a significant concern for vested interests in the asbestos sector and government; in 2022, Russian asbestos exports were worth US$232,000,000.6 When plans announced this summer by Russia’s Ministry of Health to recognize occupational cancers, including those caused by exposures to asbestos, as industrial diseases are added into the mix, the future for this industry looks bleak.7
China (200,000 tonnes/t) and Kazakhstan (260,000t), which together accounted for 35% of global asbestos production in 2023, have been actively pursuing new asbestos markets, building infrastructure, and developing streamlined systems to speed up deliveries and reduce shipping costs.
 Officers from Lanzhou Customs inspecting July 2024 asbestos shipment from Gansu Province to Nigeria. |
In recent weeks, it was reported that the first ever asbestos shipments were dispatched from Gansu Province, China to Central Asia and Africa.8 Although the amounts were relatively minor – 120t and 50t respectively – the import of China’s expansionist plans was self-evident.
With the war on Ukraine negatively impacting Russia’s commercial sector, asbestos interests in Kazakhstan, who worked closely with Russia in the past, are now implementing bilateral trade agreements with China to strengthen economic ties and facilitate exports. Using new transport hubs and logistics – such as “The Belt and Road Initiative”9– Kazak asbestos exporters hope to benefit from improved access to markets in central Asia.10
Concluding Thoughts
There is no honor amongst thieves, so the saying goes. There is certainly no loyalty amongst former asbestos allies when national priorities change. Canada, for decades the world’s number one asbestos producer and cheerleader, turned its back on the industry once the political tide turned, as did France which had played a crucial role in promoting asbestos industry interests within the European Union. In fact, it was the French asbestos ban which impelled Canada to bring a legal action at the World Trade Organization. The case was lost in 2001; it took another 17 years before Canada also outlawed the commercial exploitation of asbestos.
It is unlikely that Russia will follow suit any time soon but as outlets for asbestos shrink, market forces may succeed where the Russian government has failed. With dwindling sales, the once mighty asbestos industry may no longer be financially viable. Time will tell.
August 13, 2024
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1 For several decades, Russian producers have accounted for the majority of asbestos consumed around the world every year.
2 Kazan-Allen, L. Russians Losing Key Asbestos Market. June 5, 2024.
http://ibasecretariat.org/lka-russians-losing-key-asbestos-market.php
3 Kazan-Allen, L. India Transitioning to Asbestos-Free Technology. July 5, 2024.
http://ibasecretariat.org/lka-blogzxa223.php
OEC. Asbestos in Russia. Accessed August 7, 2024.
https://oec.world/en/profile/bilateral-product/asbestos/reporter/rus
4 Kazan-Allen, L. Kazakh Producers Chasing Russian Asbestos Markets. September 6, 2022.
http://ibasecretariat.org/lka-kazakh-producers-chasing-russian-asbestos-markets.php
5 United States Geological Survey. Asbestos Statistics and Information. Accessed August 12, 2024.
https://www.usgs.gov/centers/national-minerals-information-center/asbestos-statistics-and-information
6 OEC. Asbestos in Russia. Accessed August 12, 2024.
https://oec.world/en/profile/bilateral-product/asbestos/reporter/rus
7 Kazan-Allen, L. Russian Ministry Planning Action on Asbestos Hazard. June 18, 2024.
http://ibasecretariat.org/lka-russian-ministry-planning-action-on-asbestos-hazard.php
8 Gansu Province is the asbestos heartland of China, responsible for 80% of annual output.
首条“敦煌-青岛港”石棉海铁联运专列成功发运! [The first “Dunhuang-Qingdao Port” asbestos sea–rail intermodal special train [cargo] was successfully shipped!]. January 5, 2024.
https://www.jfdaily.com/sgh/detail?id=1227371
甘肃省温石棉首次出口中亚国家 [Chrysotile asbestos from Gansu Province is exported to Central Asian countries for the first time]. August 1, 2024.
https://www.gansu.gov.cn/gsszf/c100002/c100006/c100007/202408/173961199.shtml
甘肃温石棉首次出口非洲 [Gansu chrysotile asbestos exported to Africa for the first time]. August 1, 2024.
https://www.gs.chinanews.com.cn/news/2024/07-05/372612.shtml
9 “The Belt and Road Initiative” is making great headway in opening up China’s access to Asian export markets in countries including Laos, Thailand, Vietnam, and Myanmar. Other new high-speed railway connections are promoting connectivity between China and Indonesia, Thailand, Laos. Vietnam and Malaysia.
国际班列助力中国与东南亚互联互通 [International trains help connect China and Southeast Asia]. August 3, 2024.
http://world.people.com.cn/n1/2024/0803/c1002-40291626.html
10 “一带一路”为中亚农产品和矿产品提供出海便利 [The Belt and Road Initiative provides convenience for Central Asian agricultural products and mineral products to go overseas]. July 2, 2024.
http://www.news.cn/world/20240702/565cc48d2ebf444f84fea9e0463554cc/c.html
