China’s top coal-producing region reports sharp output decline

Coal output in Shanxi Province, China’s largest coal-producing region, was down 21.3 percent year on year in April as local authorities moved to cut capacity, Xinhua news agency said.

Local coal mining companies with annual revenues of more than 20 million yuan ($3.1 million) churned out 58.2 million tonnes of raw coal last month, it quoted the the provincial statistics bureau as saying.

The northern region faces severe overcapacity as the country’s economy slows.

Last year, the coal mining industry in Shanxi reported a massive loss of 9.4 billion yuan, or roughly 10 yuan per tonne of coal, Xinhua said, adding that coal mines were ordered last month to operate below 84 percent of production capacity. Many mines were ordered to halt production or stop construction, it added.

The Shanxi provincial government said earlier this month that it would stop approving new coal mining projects and slash coal production capacity by over 100 million tonnes in the years leading up to 2020.

 

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