TIANJIN — Reduction in production capacity has led to soaring profits and healthier coal mining and steel industries in China, according to the Ministry of Land and Resources.
Capacity cutting, part of supply-side structural reform, has borne favorable fruits since last year, said Jia Wenlong, an economic research official of the ministry, during the China Mining Expo held from Sept 23 to Sept 25 in Tianjin.
In 2016, China slashed 290 million tonnes of coal capacity and 65 million tonnes of capacity for iron and steel, Jia said.
From January to June this year, 110 million tonnes of coal production capacity was reduced, while about 42 million tonnes of steel and iron capacity was cut in the first five months of this year.
Profits for the mining sector from January to July hit 279.6 billion yuan (about $43 billion), 7.5 times the figure for same period last year, Jia said.
“The mining sector is stable and profits have increased remarkably,” he said.
According to Jia, a total of 1,900 coal mines across the country were shut down last year. The number of coal mines is now at around 9,000, and average capacity for the shafts has been raised.