China's coal output in November hit its highest since June at 299.98 million tonnes, data showed on Thursday, boosted by firm demand from coal-fired power plants as the country's heating season kicked off in the middle of the month. Analysts expect coal demand in the world's top consumer of the fuel to continue to rise in the coming months as many homes have reverted to using the commodity for heating due to natural gas shortages. Many are also using electric heaters, drawing on power from coal-fired power plants.
Demand for gas has surged this winter after the government ordered millions of households and industrial plants across the north to switch to the cleaner fuel from coal as part of its war against smog. But supplies have not been able to keep up with the extra consumption. The nation's capital city Beijing will restart a coal-fired power plant to help ease the deepening gas supply crunch.
"The decrease of coal consumption from households has been offset by the soaring demand from utilities," said Wang Fei, a coal analyst at Huaan Futures. Coal remains China's major fuel for power producers, with more than two-thirds of its electricity generated from coal-fired plants in October even as Beijing aims to promote renewables and natural gas.
"Coal supplies remain tight in some regions due to increasing demand from power, chemicals and metallurgy sectors. The authorities will continue to release high-quality coal capacity to ensure sufficient fuel supplies," said Wang. The monthly total was down 2.7 percent on the year, the National Bureau of Statistics said on Thursday.
Output over the first eleven months of the year reached 3.14 billion tonnes, up 3.7 percent compared with the same period of last year. The country produced 3.64 billion tonnes in 2016, the third annual drop. The production of coke used in steelmaking fell 10.9 percent in November to 34.47 million tonnes, with year-to-date output reaching 398.43 million tonnes, down 2.7 percent.
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