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Another deadly coal accident in China threatens output growth

By illuminem briefings 🌎

Aug 25 2023 · 1 min read

Illuminem Voices
Energy Sources · Coal · Mining & Metals

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🗞️ Driving the news: China's coal industry faces repeated fatal accidents, the most recent being a gas explosion in Shaanxi, which may obstruct plans to increase production due to potential renewed safety scrutiny

🔭 The context: This explosion in Shaanxi is the most severe since the mine collapse in Inner Mongolia in February, which resulted in 53 deaths and initiated country-wide safety checks 
• Consequently, China's production target was decreased by almost 100 million tons to 4.6 billion tons this year.

🌎 Why does it matter for the planet: China, the world's top coal producer and user, faces global environmental implications with shifts in its coal strategy
• While prioritizing coal for energy security, safety concerns highlight the risks of such dependence

⏭️ What's next: Should regulators act similarly to the past, it will challenge China's ambition to increase its monthly coal output levels
• The implications of these frequent accidents could also push China to consider safer and more sustainable energy alternatives

💬 One quote: "If regulators respond in similar fashion, it’ll be difficult to keep raising average monthly levels of output..." (Hou Jian, China Coal Transport and Distribution Association)

📈 One stat: The latest incident caused coking coal futures in Dalian to surge by over 8% this week to over 1,500 yuan ($206) a ton

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