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Yanzhou Coal aiming for over 100 million tonnes of domestic sales by 2020

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Yanzhou Coal aiming for over 100 million tonnes of domestic sales by 2020

expects annual coal sales to rise over the next five years to more than 100million tonnes by 2020, CFO Zhao Qingchun said at the sidelines of a mediabriefing for its annual results in Hong Kong on March 30.

Thecompany booked coal sales of 87.2 million tonnes in 2015, down 29.11% from ayear ago.

ChairmanLi Xiyong noted that the company does not plan to export coal products, with its2020 sales objective aimed at the domestic market.

"Webelieve that the coal price [has] hit…bottom and will rebound this year as thedisequilibrium between supply and demand in the domestic market is improving,"said Li.

Incontrast, significantly larger Hong Kong-listed coal miner islooking to substantially increasecoal exports this year, particularly to South Korea and Japan, to weather lowerdemand at home.

Thetwo Chinese coal majors also adapted different approaches in staff managementamid the industry downturn.

WhileChina Shenhua said it would notmake any staff redundant amid capacity reduction, Zhao expects Yanzhou Coal tolay off about 6,000 employees this year, who account for about 10% of the miner'stotal staff.

"Wemanaged to lay off some surplus staff in 2015, which help cut our labor cost by10% in 2015, and we will continue the strategy this year," Zhao said.

Zhaoadded that the company would prioritize rehiring those laid off when it neededto secure additional staff.

Thecombined capacity of the Yanzhou Coal's four under construction coal mines inChina is 26.8 million tonnes.

The5 million-tonne ZhuanLongwan mine, 10 million-tonne Shilawusu mine, and 10 million-tonneYingpanhao mineare yet to receive mining licenses from the relevant authorities. Zhao noted that the company has no timetable for productionat the three projects.

The1.8 million-tonne Wan Fumine will kick off production by the end of 2020, according to Zhao.

Thecompany's CapEx this year is budgeted at about 8.5 billion yuan, of which aboutUS$400 million is earmarked for the second phase of development at itsMoolarbenproject in New South Wales.

As of March 29,US$1 was equivalent to 6.51 Chinese yuan.