China cuts working hours for coal miners in bid to tackle supply glut

A worker opens a door of carriage as it is cleaned to load coal outside a coal mine on the outskirts of Jixi, in Heilongjiang province, China, October 22, 2015. REUTERS/Jason Lee/Files

BEIJING (Reuters) - China will reduce the number of statutory working days for its coal miners to 276 a year from 330 as it bids to tackle a chronic supply glut that has sapped prices, the country’s work safety watchdog said on Monday.

With demand on the wane and mining firms facing widespread losses, China plans to shut down 500 million tonnes of coal production capacity over the next three to five years as part of its efforts to cut a surplus estimated at more than 2 billion tonnes a year.

China's State Administration of Work Safety ( said in a notice on its website on Monday that the official production capacity of the country's coal mines would be adjusted to fit the new 276 working day limit, meaning that mines will be held to even stricter production caps.

China’s mines traditionally produced more than their designed capacity as miners worked throughout the year to churn out as much coal as possible.

But the practice has led to safety problems as well as oversupply, and China is now cracking down on mines that produce more than they are allowed.

The country has also promised to ban all new coal mine projects for at least three years, and will close more than 1,000 mines this year.

Coal production in China fell 3.5 percent to 3.68 billion tonnes last year, dropping for the second year in succession amid slowing industrial demand and a state campaign to cut the country’s dependence on polluting fossil fuels.

In a break with tradition, Chinese coal miners this year allowed their workers to leave their posts during the Chinese new year holidays, another move aimed at curbing oversupply and shoring up prices.

Reporting by David Stanway; Editing by Susan Fenton