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Coal production rises as China is re-opening mines

Coal minig is increasing in China. The Chinese government encourages the miners to produce more as it expects new demand after covid opening.

China will produce more coal again

China’s coal production increased by 5.8% during the initial 2 months of 2023 compared to the same time frame a year earlier. According to government data released on Wednesday, the increase was attributed to the introduction of new mining capacity and Beijing’s encouragement of miners to increase production in hopes of enhancing energy security.

China, the world’s largest coal producer and user, produced 734.23 million metric tonnes of the fuel during January and February, up from 686.6 million metric tonnes during the same time in 2022, as reported by the National Bureau of Statistics (NBS). This is equal to 12,44 million metric tonnes daily.

The production is down from 12,99 million metric tonnes daily in December, as coal producers reduced or even ceased operations over the Lunar New Year break in January. Russia’s invasion of Ukraine has also forced Beijing to place a greater emphasis on energy security.

More to read: Oil falls amid rising yields – US inflation is out

Miners increased output in expectation of a rise in demand once COVID-19 limits were lifted at the end of 2022. This year, the government authorized 260 million metric tonnes of additional mining operations capacity and revived a number of mines that had been closed. This year, the government authorized 260 million metric tonnes of additional mining operations capacity and revived a number of mines that had been closed.

Environmentalists of the US are moving forward

The US Environmental Protection Agency (EPA) approved a rule requiring industrial sites and power plants in 23 states to reduce their smog-forming nitrogen oxide (NOx) emissions on Wednesday. Affected power stations will engage in a revamped ozone season trading scheme beginning in 2023.

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Beginning in 2024, the EPA would gradually tighten emission limitations to incentivize the phased deployment of pollution controls. Starting with the ozone season of 2026, the EPA will establish NOx emission control regulations for both current and future emissions sources, including cement kilns and solid waste incinerators.

Chinese mining dominated by bears

Shanxi and Inner Mongolia, China’s two most productive mining regions, have pledged to increase output by at least 5% and 2%, respectively, this year. The rising production seems to have not met its demand so far and the Chinese company broke through the 200-day average downwards.

This sharp downward action at the 12 level formed a support below the 12.77 200 day average. In case the bears break through, we can expect the price go lowetowards the 11 area. Bulls might use this as an opportunity for correction movement and use the 200 day averarge price as their target. 

coal china

Shanxi mining company 1W chart, source:, author’s analysis

Tomáš is a financial reporter with US markets as his main field. Tomáš is an aspiring author and entrepreneur aspiring to help people get better in financial knowledge.


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