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Shandong to cap 2015 coal output at 146 mt

East China’s Shandong has aimed to control its total coal output within 146 million tonnes in 2015, in response to low prices and wide losses among miners, the provincial coal industry bureau and the provincial development and reform commission jointly said in a statement on August 14.

By setting the cap on production, the bureau expects to ease oversupply and rebalance the market in the province.

Under output control, Shandong is projected to produce 71.65 million tonnes of coal in the second half of the year (H2), based on a combined output of 74.05 million tonnes in the first half (H1).

Of the total annual target, state-owned mines plan to produce 103.2 million tonnes or 70.8% this year, with expected 50.7 million tonnes for H2 following 52.5 million tonnes in H1.

The remaining 29.2% or 42.49 million tonnes are expected to come from small local mines, with H2 target at 20.95 million tonnes on top of H1 production of 21.54 million tonnes.

Those mines, which produced more than their approved capacity in the first half of the year, have been asked to cut or limit production to meet their annual target.

Shandong has seen its coal output steady at around 150 million tonnes for nearly ten years, with last year’s output at 148 million tonnes, down 2.28% on year, data showed.

There are 174 coal mines in the province with a combined approved capacity of 172.2 million tonnes per annum (mtpa), of which 116.15 mtpa is from 55 state-owned mines and 56.05 mtpa from 119 small local mines.

source: http://en.sxcoal.com