China June coal output hits record high as miners ramp up ahead of summer

FILE PHOTO: Cranes unload coal from a cargo ship at a port in Lianyungang, Jiangsu province, China December 8, 2018. REUTERS/Stringer/File Photo

BEIJING (Reuters) - China’s coal output rose in June from the previous month to a record high, official data showed on Monday, as miners ramped up production to ensure supply ahead of peak summer demand for electricity.

The world’s top coal producer churned out 333.35 million tonnes of coal in June, up 6.7% from May and up 10.4% year-on-year, data from the National Bureau of Statistics showed.

Output over the first half of 2019 reached 1.76 billion tonnes, up 2.6% from the same period last year.

Summer is typically a high season for electricity demand in China due to increasing use of air conditioners in hot weather.

China’s state planner and energy administration have asked miners, especially big producers in Shanxi, Shaanxi and Inner Mongolia, to step up production of high-quality coal to meet increasing demand.

China generated 583.4 billion kilowatt-hours (kWh) of power in June, up 2.8% year-on-year, the data showed, with coal-fired power generation rising 0.1% from a year ago after two months of year-on-year declines.

Meanwhile, Beijing has been approving new coal mining capacity in recent months despite a push to promote clean energy and reduce its carbon footprint.

With new capacity coming on line, coal prices on the Zhengzhou Commodity Exchange CZCcv1 are currently around 583 yuan ($84.81) a tonne, down almost 5% from a two-month high of 612.60 yuan in mid-June.

Meanwhile, China’s production of coke, used in steelmaking, rose 10.7% year-on-year in June to 41.69 million tonnes, with year-to-date output reaching 233.87 million tonnes, up 6.7%, the data showed.

Reporting by Muyu Xu and Tom Daly; editing by Richard Pullin