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Coal Industry in the Black
China's coal sector, which has stuck in red for years, is now in the black for the first half of this year.
Key State-owned mines are expected to register profits by year's end to halt a downward trend, a leading official said.
The sector posted a profit of 860 million yuan (US$104 million) from January to June, a dramatic reversal from last year's deficit of 880 million yuan (US$106.4 million), said Shi Wanpeng, vice-minister of the State Economic and Trade Commission.
The top 80 State coal mines, which are subsidized by the central government, registered profits of 360 million yuan (US$43.5 million), surging from last year's deficit of 1.2 billion yuan (US$139 million).
Shi attributed the turnaround to the government's tough efforts to curtail production and boost coal exports. These moves eased the coal glut in the domestic market.
"The control over the overproduction pushed the price back to normal,'' Shi said. "It is the only way to help the industry out of its slump.''
China produced 498 million tons of coal, up 1.8 per cent over the same period last year. The nation's output target is 950 million tons for all of 2001.
China closed 5,117 small coal mines with the annual production less than 10,000 tons over the past six months. Most of 270,000 county-level small coal mines also have halted production.
China, the world's largest coal producer, has shut down some 473,000 small coal mines since 1998, cutting coal production down to last year's 910 million tons from the peak of 1.3 billion tons in 1997.
Shi said the production of large State coal mines now accounts for 57 per cent of the national total, up from 1998's 40 per cent.
Shi said the nation will continue its efforts to close all small coal mines.
China has done better at selling coal abroad as well. During the January-July period, China exported 47.9 million tons of coal, up 65 per cent year-on-year.
China is expected to export 63 million tons of coal this year, compared with 58 million last year.
The shrinking output has pushed the price up 10 yuan (US$1.2) a ton on the average, Shi said.
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