Undersupply of coal to ease in 2006
(Xinhua)
Updated: 2005-11-27 15:23

The coal supply, especially that for power plants, is expected to ease in 2006, according to the China Coal Industry Association.

Total coal production in China is expected to grow 8 percent over last year to more than 2.1 billion tons in 2005. In the meantime, demand of coal for power generation will increase 120 million tons to 1.12 billion tons, the association estimated.

"After the macro-control policy was implemented, undersupply of coal for power plants in the past two years has been easing gradually since the beginning of this year," said an expert from the association.

During the January-September period, the supply of coal for power plants increased 18.1 percent year on year to 367 million tons, resulting in a historical high coal stock in September and October in the past several years.

Power plants' coal stock exceeded 28 million tons in September and October, which can last for 19 days and is a sharp increase over the same period last year, according to the expert.

However, sources with China Electricity Council pointed out that there are still worries in the electric coal market even with less-tightened supply.

As winter comes, the sources noted, coal demand will augment for heat supply and enhanced electricity demand, and less rainfall will reduce hydropower supply. Unfavorable weather in winter will also affect coal transportation through railways and highways.

Besides, debased coal quality has become an factor for the unstable market of coal supply, according to the sources.