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The \"2025 Annual Report on the Development of the Coal Industry\" (hereinafter referred to as the \"Report\") released recently by the China Coal Industry Association shows that last year, the country’s raw coal production amounted to 4.85 billion tons, a 1.4% increase compared to the previous year. At the same time, the revenue of coal enterprises above a certain scale across the country declined year-on-year, and the proportion of losses in this industry increased further. “\"Excessive supply and low consumption\" remains the issue restricting the development of the coal industry at present. Currently, with the ongoing conflict between the United States, Israel, and Iran and disruptions to oil and gas transportation routes, demand for coal in Asia is on the rise. China’s role as a backup supplier of coal has become increasingly important, and the increased generation from coal-fired power plants is boosting demand for coal. The Report predicts a slight increase in coal consumption this year, with coal use in the power sector seeing a modest rise; the role of coal-fired power plants in providing peak-shaving capacity will remain important. As coal shifts from being a single fuel to one that is used both as a fuel and as a raw material, coal chemical production will maintain strong momentum, and the amount of coal consumed in the chemical industry will also increase. In the future, as the peak period of coal consumption is reached, driving the transformation and upgrading of the coal industry becomes an inevitable choice for its development. The deep integration of coal with new energy sources, as well as the improvement of the utilization level of co-occurring resources in coal deposits, represent the direction in which the industry continues to develop. ■■Advantages in the energy crisis: Following the conflict between the US, Israel, and Iran, international oil and gas prices experienced severe fluctuations. Over 80% of Asia’s imports of crude oil and liquefied natural gas rely on the Strait of Hormuz for transportation, with countries such as Japan, South Korea, and India accounting for more than 90% of their liquefied natural gas imports that pass through this strait. Compared to oil and gas, coal prices currently experience less volatility, with traditional exporting countries such as Mongolia, Indonesia, and Australia being close to the coal-consuming regions in Asia. Japan and Thailand have restarted coal-fired power plants, while South Korea has relaxed restrictions on coal-based power generation; thus, the role of coal in ensuring energy supply has increased significantly. Liu Zhijiang, president of the China Coal Transportation and Marketing Association, noted that recently the output of gas-fired power plants in China has decreased compared to the previous year, while the output of coal-fired power plants has increased. Power plants along the coast have boosted their purchases of domestic coal, resulting in a slight increase in demand for thermal coal. Furthermore, disruptions to routes in the Middle East have perturbed the petrochemical supply chain, and the stability advantage of coal-based chemical feedstocks is becoming apparent. Liu Zhijiang pointed out that recently, the operating rate of coal chemical industries in China has remained high, and the demand for coal for industrial use is also increasing. At the same time, with high oil prices, the cost advantage of rail transportation continues to increase. “Since the beginning of this year, coal rail transport in our country has seen an increase in volume and an optimization of its structure; under the dual pressures of peak passenger demand and the need to ensure a stable supply of energy, both resilience and efficiency have improved simultaneously. ” In the first quarter of this year, China’s coal production, imports, and consumption were relatively balanced; coal inventories were at high levels, ensuring an ample supply in the market. Although the spot price of thermal coal has risen, it is 10% lower compared to international prices. “The recovery in international coal demand has prompted a adjustment in China’s coal import structure. Recently, domestic imports of sea-borne coal have decreased, and imports of coal by land route have also fallen. ”Liu Zhijiang pointed out that to cope with market fluctuations, it is necessary to promote stable coal production in accordance with laws and regulations, strictly ensure the fulfillment of medium- and long-term thermal coal contracts, and effectively meet the demand for thermal coal. Amid the situation of inverted import coal prices, coal companies need to actively expand their downstream markets, increase their share in the domestic coal trade, and make every effort to meet the demands of industries that rely on coal. ■■Coal consumption for power generation will see a slight increase. While the conflict between the United States, Israel, and Iran is driving up demand for coal, it should also be noted that there is an increasingly clear trend of a disconnect between the growth rate of electricity consumption across China’s economy and the growth rate of coal consumption. Last year, coal consumption was generally low, putting pressure on the profitability of the coal industry. The report shows that last year, the spot market prices of thermal coal dropped significantly, while the prices of coking coal also fell sharply. Behind this is the decline in coal demand by the power and steel industries. The China National Coal Association pointed out that last year, the total thermal power generation decreased by 1.0% year-on-year, affecting the growth in demand for thermal coal. Meanwhile, the output of pig iron by enterprises above a certain size fell by 3.0% year-on-year, and coal consumption in the steel industry also declined compared to the previous year. Guo Zhonghua, director of the Policy Research Department at the China Coal Industry Association, noted that the coal industry is highly affected by periodic price fluctuations, with 48.26% of companies in this sector suffering losses last year. “Coal consumption in the power industry is set to increase slightly this year. ” According to the China Electricity Council’s forecast, overall electricity consumption across the country is set to increase by 5%–6% this year. The construction of a new energy system is accelerating, and the role of clean energy in replacing coal-fired power is becoming more prominent. However, coal-fired power must still meet the needs for “peak shaving” under circumstances such as “unexpectedly rapid growth in energy consumption” and insufficient output from new energy sources. Meanwhile, coal consumption in the steel industry will remain roughly unchanged or decline slightly, while coal usage in the building materials industry will decrease marginally. Among the four major coal-consuming industries, coal chemical industry was the only one to see an increase in coal consumption last year; the production volume of key coal-based products increased at a rapid pace, and the operating load of new coal chemical plants was high. The Report indicates that this year, the demand for agricultural fertilizers produced domestically, as well as the export demand for other downstream products of the coal chemical industry, will continue to support strong activity in coal chemical production. Meanwhile, taking into account the need to utilize newly added production capacity, it is expected that coal consumption in the chemical industry will maintain steady growth. ■■Transformation must continue to advance. Over the next 5 years, the increase in electricity demand in our country will be met primarily by renewable energy sources, and by 2035, non-fossil energy sources will account for over 30% of total energy consumption. The Report points out that with the advent of a plateau phase in coal consumption, the traditional development model of the coal industry—which relies on expanding scale and increasing output—is no longer sustainable. Promoting the transformation and upgrading of the coal industry is thus a strategic choice for its development. However, at present, coal still plays a crucial role as a safety net. Over the past 5 years, the country has produced approximately 23 billion tons of raw coal in total, accounting for about 65% of the total production of primary energy nationwide; coal consumption accounts for around 54% of the total energy consumption. New energy needs to gain momentum, and coal support is indispensable. Liang Dunshi, vice president of the Coal Economy Research Association, pointed out that a coal reserve capacity system can enhance the flexibility of coal supply and also play a significant role in promoting the high-quality development of new energy sources. By 2030, China aims to build a reserve of dispatchable production capacity of around 300 million tons per year. “In extreme situations, coal production capacity can increase elastically, with reserve capacity being rapidly deployed to enhance the capacity for emergency coal supply. When coal supply is abundant, reserve-capacity mines operate at their normal production levels, thereby making room for the development of new energy sources. ” Guo Zhonghua said that land resources such as coal mine facilities, subsidence areas, and waste dump sites can be utilized to accelerate the development of projects in areas such as photovoltaic power, wind power, and energy storage, thereby achieving a deep integration between the traditional coal industry and the new energy industry. Furthermore, the resources associated with coal mining also hold great potential for utilization. Ma Jian, president of the China Coal Processing and Utilization Association, said that in the future it is necessary to systematically improve the efficiency of utilizing associated resources. Efforts should be made to carry out coordinated development and clean utilization of coal-related associated resources such as coalbed methane, mine water, and oil shale. The models for on-site disposal and utilization of solid waste need to be improved, and mature technologies for resource utilization such as gas extraction and the efficient reuse of mine water should be promoted.