- Shanxi mine resumptions face setbacks
- Coal output remains below normal
MySteel Global: The resumption of coal mines in North China’s Shanxi province has faced new headwinds this week due to fresh safety inspections across the top coal-mining heartland of China, defying a market consensus of a slow but steady supply recovery.
According to Mysteel’s latest survey, the total number of coking coal mines once brought to a halt or still closed in the province since after the fatal mine accident on 22 May mounted to 160 as of June 24, posting another increase of 5 mines from a week earlier.
The total idled capacities in parallel climbed to 199.4 mnt/year, up from 183.1 mnt/y a week prior, the survey results indicate.
Within the total, the number of mines that resumed operations by 24 June decreased to 93, 4 less than the previous survey’s 97, putting 4.5 mnt/y capacities offline to leave only 112.9 mnt/y in the market. Meanwhile, the number of mines that remained halted or closed ascended to 67, with 86.5 mnt/y capacities idled, 31.7% higher than one week before, as per the survey.
Survey respondents shared that a few more mines in Shanxi have suspended operations lately amid the strengthening safety oversight campaigns. For example, a large state-run coal mine in Gujiao, Taiyuan city, was closed to accept checks during 22-24 June, involving a capacity of 6.4 mnt/y. Another major state-owned mine in Liulin, Lvliang city, remained halted for over a week.
The scope of safety checks has expanded as well. Production suspensions emerged in Ningwu, Xinzhou city, that had not experienced such mine closures during this round of massive halts in Shanxi since late May, the survey highlights.
For the most-watched Qinyuan county, the site of the deadly mine accident and a production base of premium coking coal in Changzhi city, restart progress has also stalled following the resumption of only a local mine on 18 June, restoring capacity of 1.5 mnt/y.
The resumption of two other mines in Qinyuan has been shelved for now, even after securing initial approval. In Qinyuan, a total of 27 coal mines-with a combined capacity of 28.9 mnt/y-have been ordered to suspend operations since 23 May, including 5 long-idle mines and 2 thermal coal mines, as reported.
As mining safety oversight extends further in the coming period, the coal industry is expected to see more frequent oscillations between production halts and resumptions, market sources predict.
Output from the restarted mines is unlikely to return to normal soon, as safety remains the top priority, with individual production drops estimated at 10-80%. Mysteel’s survey showed that the 93 resumed coal mines in Shanxi produced only 295,500 t on 24 June, down 26.4% from their pre-suspension level of 401,500 t.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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