Impact on the Group activities Y 2025

THE IMPACT OF THE ARMED CONFLICT IN UKRAINE ON THE GROUP’S ACTIVITIES

The war in Ukraine and sanctions imposed on Russia have caused a reorganization of the global coking coal market. Before the war in Ukraine, Russia’s share of coking coal imports to the EU was: approx. 10% for coking coal and approx. 30% for PCI coal. After the introduction of the sanctions, Russian coal was diverted to the Asian market, mainly to India and China. The missing volumes in the European market were supplemented by supplies from Australia and the US. The sanctions imposed on Russia have not significantly reduced the supply of coking coal on global markets, but they have changed the direction of trade. At present, the share of imports of coking coal from Russia in the total Chinese imports increased from approx. 7% in 2016-2020 to approx. 28% in 2025.

Before the war Ukraine was one of four countries that were self-sufficient in terms of raw materials for steel production in the world, including coal, iron ore, manganese ore and ferro-alloys. By the end of 2024, production had been suspended at the Pokrovske coking coal mine - last one still operating in Ukraine - and most of the coking plants had also been destroyed. As a result of the above, it is necessary to shift from self-sufficiency in terms of raw materials for steel production to steel production based on imported raw materials.

According to the GMK Center website, coke imports to Ukraine in 2025 totaled 700.7 thousand tons, marking a 5.9% increase compared to 2024. Most of the imports came from Poland – 657.8 thousand tons.

It is difficult to estimate the long-term impact of the war in Ukraine on the European and global markets. Globally, the war in the territory of Ukraine has resulted in a less stable economic situation, higher inflation and rising interest rates. The Group monitors the economic situation on an ongoing basis to assess its potential negative impact on the Group and take measures to mitigate this impact.

In addition to threats, the war in Ukraine also creates market opportunities for the Group’s operations. The loss of self-sufficiency in raw materials by Ukraine opens up new markets for the Group. Coke is delivered on a regular basis and test deliveries of coking coal have also been made. Ukraine will need a considerable amount of coking coal and steel, among others to rebuild housing and social infrastructure destroyed by the Russian invasion.

Source: MANAGEMENT BOARD REPORT ON THE ACTIVITY OF JASTRZĘBSKA SPÓŁKA WĘGLOWA S.A. AND THE JASTRZĘBSKA SPÓŁKA WĘGLOWA S.A. GROUP FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2025