China’s top coal producing region tells miners to curb overproduction

BEIJING: China’s top coal-producing region of Shanxi has ordered miners to curb overproduction, according to a notice this week from authorities in the northern province, sparking a rally in coking coal futures on Wednesday.

Coal miners in Shanxi were asked to reduce output and carry out safety checks from March to May, according to the Feb 19 notice by the provincial emergency management, mine safety and energy bureaus.

The province produces 29% of China’s coal supply, including thermal coal for power plants and coking coal, a key steelmaking ingredient.

Brokerage China Futures said the order could reduce supply by a combined 5 million to 6 million metric tons for two major producers, Shanxi Coal International Energy Group and Shanxi Luan Group.

Officials at the companies could not immediately be reached for comment.