It is reported that Northwest China's Shaanxi province has been witnessing high inventories of power generating coal since July 2012, mainly due to dull sales caused by weaker demand.

According to data released by relevant authorities, as of end July 2012, power coal stocks in Shaanxi hit 2.466 million tonnes, increasing 1.397 million tonnes or up 101% compared with the previous year.

Sluggish demand for electricity within the province coupled with the gloomy outbound transmission have led to a marked deceleration in thermal plants' power output, reducing the daily coal use to only 75,000 tonnes on average, down more than 33% from a year ago.

As of August 7th 2012, coal stocks in power plants reached 2.31 million tonnes, enough to cover 15 days. Hydropower output in neighboring Qinghai and southern China has been sufficient this year, thanks to plentiful rainfall. Because of sharp fall in domestic coal price, local coal mines are selling coal at levels far lower than that of key state owned coal mines, so many power plants with high inventories are reluctant to purchase or even refuse to accept coal supplied by the latter.

Source - www.sxcoal.com

(www.coalguru.com)