Over 90% of Coal Firms Losing Money in China; Govt Funds For Workers, Not Companies

In this regard, China Coal Industry Association Statistics and Information Department Director Chen Yang was told, "First Financial Daily" reporters, the current coal prices cause a loss for more than 90 percent of the industry. At the end of 2015, the Bohai Sea thermal coal price index dropped to 370 yuan / tons, if the prices remain a year, the entire coal sector will certainly be losing money.

...It is noteworthy that, as of the end of 2015, the Bohai Sea thermal coal price index fell to 370 yuan / ton, but early 2015 is 525 yuan / ton.

As Kang Ji said, this is a gradual process of decline until after October 2015, coal was dropped 380 yuan / ton, to 370 yuan / ton. "But if coal prices continue to fall, or it stays at 370 yuan / ton, we believe that in 2016 the industry will face a bigger problem" he said.
Will production be meaningfully cut?
In fact, cuts to the production capacity has been going on. According to Chen Yang was introduced, "12th 5-year plan" period, the national total of 7,250 coal mines and eliminate backward production capacity of 560 million tons; in 2015 the country only eliminated 1340 backward coal mines, backward production capacity of about 90 million tons. Up to now, the number of coal mines has dropped to 9624 nationally, completed the "12th 5-year plan" goal to reduce the number of coal mines to less than 10,000.

To this end, the authorities will set up special funds to capacity. January 12, the National Development and Reform Commission Secretary-General, spokesman Lee Park Min on macroeconomic conference to iron and steel, coal and other industries, strive through a period of efforts, a breakthrough in terms of resolving overcapacity, while the central government will set up special funds to local governments and enterprises to resolve the overcapacity were awards complement.

But how to spend the capacity of special funds has become the focus of attention, naturally also a hot topic year 2015 Development of Coal Industry press conference.

Kang Ji told the "First Financial Daily" reporters, Prime Minister Li Keqiang held a forum in Taiyuan, has made the central government will set up special funds, but how much, how to spend, this we are studying. But the prime minister has told us, this (special funds) is primarily for the placement of personnel." Kang Ji said.
iFeng: 煤炭业告急!行业亏损面超90% 哀鸿一片

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