- Shanxi suspends 113 coking coal mines
- China coking coal prices surge
MySteel Global: Following the fatal mine explosion in Shanxi’s Qinyuan county last Friday, as of May 27 some 113 coking coal mines the North China coal production hub remain suspended for safety checks, Mysteel’s latest survey results show.
As the 113 mines have a combined production of 125 million tonnes/year, the shutdowns are estimated to be reducing raw coking coal production by a huge 328,400 tonnes per day, according to Mysteel’s survey.
By region, 27 coking coal mines remain offline in Changzhi city where local authorities issued an urgent notice on Monday, vowing to crack down on illegal mining activities. Qinyuan county where the mine disaster occurred is within Changzhi’s jurisdiction, and probes have revealed concealed working faces and falsified tunnel drawings, according to state news agency Xinhua.
Apart from some state-owned mines, most private coking coal mines in Changzhi remain closed pending further safety inspections, Mysteel’s survey shows.
In Jinzhong city, a total of 38 coal mines in Pingyao, Jiexiu and Lingshi remain suspended for self-inspections. Earlier, shutdowns in the regions were expected to last three to five days. However, the latest feedback from mining firms showed that many haven’t scheduled a clear timetable for resuming production. A few mines are planning to reschedule holidays toward early June.
Taiyuan city has eight suspended coking coal mines, and some watchers worry that these could remain closed for as long as a month. In Taiyuan’s Gujiao, operating mines are required to work for only one shift per day, with regional output expected to decline notably from previous levels, according to survey results.
Coal mines in Linfen city and Lvliang city are resuming production faster compared with those in other regions. According to Mysteel’s survey, four mines in Linfen and 12 in Lvliang had emerged from suspension as of Wednesday. Currently, 33 mines in Linfen and seven in Lvliang remain closed.
Beyond Shanxi, self-inspections and halted production are impacting mines in Northwest China’s Shaanxi and Central China’s Henan. However, production in those regions is now gradually recovering, the survey findings show.
Broad mine suspensions have largely boosted sentiment in the coking coal market. Mysteel Coking Coal Index, which tracks China’s national coking coal prices, had surged Yuan 37.5/tonne ($5.5/t) from last Friday to reach Yuan 1,400/t including the 13% VAT on May 26.
Some market players believe that China’s coking coal supplies will remain tight in the near term. “Suspended mines will take time to resume production (and) even after their operations recover, many are expected to remain on alert during production – which will weigh on overall coal supplies,” one survey respondent said.
Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.
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