China's outbound coal shipment from producing areas has experienced diminishing impact related to the previous snowfall and freezing conditions as temperatures rebounded in the past couple of days. However, foggy and smoggy weather conditions are now emerging as new interferences to highway hauling.

 

China's meteorological center forecasts mild to severe fog and haze over December 28-30 in some regions, most of which fall under the key regions for pollution control, particularly within the Beijing-Tianjin-Hebei region and surrounding areas.

 

In response to the forecast, relevant departments have implemented a new round of joint measures for air pollution prevention and control, with highway transportation being significantly affected.

 

Sources said the traffic police department in western Inner Mongolia issued an urgent notice, prohibiting coal trucks from traveling or passing through Hebei and Shanxi provinces from 6:00 p.m. on December 26 until 6:00 p.m. on January 2, 2024, as part of pollution control responses.

 

Meanwhile, Shanxi has also issued related notices demanding emission reductions. Taiyuan city has suspended the production resumption for previously shut-down enterprises, while Jincheng city has banned all vehicles from transporting coal to or through the city from December 27 to 31.

 

Despite some vehicles still transporting coal from Shanxi and Hebei, many trucks have indeed halted operations, as several coal mines have explicitly stated their refusal to accept trucks bound for and passing through the two provinces and some have ceased selling coal to there, according to an Ordos-based coal miner.

 

Environmental protection warnings have limited the turnover of highway coal vehicles, resulting in reduced loading and unloading times and causing an increase in freight rates on some routes, primarily in Shanxi and Hebei.

 

It is learned that on the evening of December 25, a road collapse incident occurred on the G55 Erguang Expressway in Ulanqab city of Inner Mongolia, leading to temporary logistics constraints.

 

Railway shipment is also facing difficulties. Data showed that due to freezing weather and decreased shipments for market coal, daily freight volume via Daqin rail line remained relatively low. The daily figure rebounded mildly from 900,000 tonnes to 1 million tonnes recently but were still below the full capacity seen previously.

 

This, coupled with favorable maritime transportation and high coal consumption at power plants, contributed to a rapid depletion of coal inventories at Bohai-rim ports, achieving a new record of depleting 1.12 million tonnes within just two days.

 

Stocks at Qinhuangdao port have dropped below 6 million tonnes, while the overall inventory at Bohai-rim ports has plunged by 3.72 million tonnes to 26.52 million tonnes from a high in mid-December.

 

On the other hand, impacted highway coal deliveries will dampen cargo inflows to Bohai-rim ports, helping reduce portside coal inventories.

 

Steel and coking firms relying on highway transportation will also experience varying degrees of impact on their replenishment of coking coal.

 

Additionally, as the end of the year approaches, coal producers are increasingly completing their annual production targets, resulting in more proactive production cuts. This has led to an overall decrease in outbound coal shipments from production regions.

 

One miner in Hangjin Banner of Inner Mongolia said that it has ceased production due to early achievement of production targets and sales are expected to restart after January 1. A Shenmu-based miner in Shaanxi also stated production halts and completed production targets.

 

Overall, coal production, transportation, and transit have experienced varying degrees of efficiency decline, posing challenges to China's coal supply chain.