China’s consumption of coal for electricity generation has gradually slid since early August, with the daily coal use at the coal-fired power houses under the national grid network totaling 6.3 million tonnes on August 23, down 15% or 1.1 million tonnes from the peak on July 15, the country’s National Development and Reform Commission (NDRC) shared in a post on Wednesday.
With the ebbing demand, coal stocks at Chinese ports have started to mount over the same period, and by August 24, total coal stocks at Qinhuangdao port in North China’s Hebei province reached 4.7 million tonnes, up around 600,000 tonnes from that at the end of July, NDRC disclosed.
China’s thermal coal supply to the country’s power plants has generally exceeded their demand, and since August 10, total coal supply to these power plants has averaged at 6.6 million tonnes/day, up 400,000 t/d from the average for July, while their total coal consumption has averaged at 6.4 million t/d, or down 400,000 t/d from July’s average, NDRC disclosed.
Lower coal consumption while higher supplies saw coal stocks at these plants under the national grid system rebounded notably since mid-August by about 3 million tonnes, the commission noted, anticipating the in-house coal stocks to climb up further on reducing consumption.
China has experienced power supply shortage since the start of 2021 amid extreme weather including cold winter, drought, and hot summer so far, which has been the first time over a decade, and NDRC has been coordinating with China’s other ministries and local authorities to boost domestic thermal coal supply and cool down the frenzy in coal prices.
Among the efforts in boosting domestic coal supplies are calling for domestic coal mines to prioritize thermal coal production, to maximize their output on the condition of safety, and to restart some qualified idled mines, Mysteel Global noted.
On August 25, NDRC shared in another post that another 16 open-pit coal mines at 25 million tonnes/year in capacity in Ordos in North China’s Inner Mongolia has received land use permits to resume operations recently, and another 50 million t/y open-pit coal mining capacity is expected to receive the permits by mid-September, which will add another 7 million tonnes/month of coal supply to the domestic market when normal production is achieved.
The investigation on illegitimate resources development since February 2020 in Inner Mongolia – China’s core coal mining region – has led to serious reduction in local coal output because of the halts or slowdown in the operations of the autonomous region’s coal mines, as reported.
Source: mysteel.com
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