According to the China Coal Transportation and Distribution Association (CCTD), China’s coal output is projected to rise by 36 million metric tons, representing a modest 0.8% increase to reach approximately 4.7 billion tonnes in 2024. This forecast indicates a deceleration from the 2.9% growth observed last year, following record-high production levels in 2023 when the country mined 4.66 billion tons of coal.
Feng Huamin, a senior analyst at CCTD’s research department, highlighted expectations for a quicker decline in domestic coal prices, attributing this trend partly to the slowdown in China’s real estate sector. Government directives to halt infrastructure projects in financially strained provinces have exerted pressure on coal prices.
The rise in output from non-fossil fuel sources is anticipated to further impact thermal coal production this year, aligning with a 5% economic growth forecast in the power sector. Forecasts suggest improvements in hydropower generation, with increased solar and wind installations poised to address a significant portion of the projected growth in power demand.
While some mines have extended production pauses post-Lunar New Year, concerns have emerged regarding inventory levels nearing capacity limits for certain mines. Additionally, Shanxi, China’s leading coal production region, is expected to decrease output by 40 million tons this year, partly due to recent accidents that have prompted safety concerns and regulatory interventions.
Despite challenges in the coal industry, industrial power consumption surged by 9.7% in the first two months of 2024, potentially impacting stockpile levels if this trend persists.