China to reopen coal mines despite Beijing's green course
The Chinese government announced the resumption of coal mining at 53 mines in the provinces of Inner Mongolia, Shanxi and Xinjiang. The authorities had to resort to such a decision, which contradicts the PRC's stated policy of reducing the share of coal-fired generation in the energy balance due to the growing demand for electricity amid extreme heat and the recovery of industrial production.
It is assumed that the reactivated mines will operate within a year, and this will provide an additional 44 million tons of coal for Chinese power plants. However, Beijing is already warning that power shortages will worsen in the future.
This means that global thermal coal prices will remain high. In May, the cost of coal for Chinese power plants broke a historic record, and LNG prices in the Asian market also increased significantly during the summer heat.