Shenhua's double-digit production cut

AN executive of leading thermal coal producer China Shenhua Energy flagged a possible production cut of up to 60 million tonnes per annum last week.
Shenhua's double-digit production cut Shenhua's double-digit production cut Shenhua's double-digit production cut Shenhua's double-digit production cut Shenhua's double-digit production cut

Image courtesy of Shenhua

Blair Price

The comment, made by Shenhua deputy general manager Wang Xiaolin at a Beijing conference, makes Glencore Australia’s plans to cut 15Mtpa this year seem piecemeal.

The executive told the conference of the company’s plans to shed output – with the Chinese government announcing plans last year to crack down on mines which produce more than approved and add to the domestic coal market glut.

“We have already completed inspections of all our mines for illegal production … and we will cut output by 50 to 60 million tonnes compared to 2014,” Wang told the conference.

Shenhua’s total 2014 coal sales slipped 12.4% in 2014 to 451Mt. A 50Mt drop from that figure equates to an 11% fall.

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