NBS: China's coal output posts first YoY increase in June

On a daily basis, coal production in June averaged 13.51 million tonnes/day, which was above the May average of 12.38 million t/d, according to NBS data.

The year's high set for coal output last month was partly due to eased safety inspections in top mining areas, such as North China's Shanxi and Inner Mongolia. This, combined with the stable coal prices, encouraged local miners to raise production at that time.

The higher coal output also added to signs that coal miners in these top mining regions were extracting more of the fuel to meet the demand for household cooling, as temperatures across many parts of China had soared in June, which required more thermal coal to be burnt to meet higher electricity demand.

The uptrend is likely to persist in July, Mysteel Global notes, as the country will face heat waves during July and August when power consumption usually peaks and when domestic power plants need to secure enough thermal coal.

Meanwhile, in the coking coal sector in June, the country produced about 41.64 million tonnes of metallurgical coke last month, up by 2.2% on year and 1.7% on month, which brought the total coke output for the first six months of this year to about 242 million tonnes, down 0.9% from the same period last year, according to the NBS data.

The increase in coke output last month was because most domestic coke plants kept lifting their rates of production after their profits on coke sales improved, Mysteel Global learned.

Written by Winnie Han, hanyueran@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com