China's daily coal output near annual high, govt continues crackdown on irregularities

November 4, 2021: China's daily coal output hit 11.67 million tonnes on November 2, rising around one million tonnes from early October, close to a record high this year amid a raft of measures to ramp up production, according to the country's state planner.

The National Development and Reform Commission (NDRC) published six statements late on Wednesday, showing recent coal production and its efforts in reining in prices.

Coal inventories at powerhouses across the country had exceeded 110 million tonnes as of Tuesday, up by more than 31 million tonnes from end-Sept, the NDRC said, adding that with production boost measures to be implemented continually, China's daily coal output is expected to break above 12 million tonnes.

Coal prices at mines and ports have dropped significantly, said the economic planner.

Producers including Inner Mongolia Yitai, China National Coal Group and China Energy Group had lowered their prices, followed by more than 10 major companies which "proactively" cut their prices of thermal coal of 5,500 kcal to below 1,000 yuan a tonne, according to one of the NDRC statements.

Thermal coal futures on China's Zhengzhou Commodity Exchange had plunged more than 50% from the historical high of 1,908.2 yuan per tonne it logged on Oct.19.

Meanwhile, the authorities continued to crack down on irregularities that disrupt market order. China's top three coal-producing regions - Shanxi, Inner Mongolia and Shaanxi - have launched campaigns to probe into illegal coal storage sites, said the NDRC.

The state planner also summoned Futures Daily on Wednesday night for the media's "false reporting" on efforts to stabilize coal prices and supplies and said it would refer it to the relevant department for punishment for inaccurate reporting.

The most-traded January contract of thermal coal fell 1.5% during the night session on Wednesday and was traded range-bound in Thursday early trade.

Reuters