A macro- and microeconomic analysis of coal production in China

Abstract

This paper examines coal production in China and reaches two primary conclusions: (1) Before 2014, the growth rate of coal production in China began to decrease, although coal production output had increased. In 2014, coal production declined because of China's growing dependence on imported coal. Net coal imports increased rapidly after 2008. Changes in coal stock should not be the primary manner in which the gap between production and supply is offset. Similar to the growth rate of coal production, investment in coal production decreased in 2013. The distribution of coal production was not balanced in China in 2013 because coal reserve distribution is not geographically homogeneous. (2) In the firm production field, the average total output value, inventory value and profit from coal mining and washing firms in China increased from 2007 to 2009. The operation status in this industry was not greatly influenced by large coal imports in 2009. Only a few coal production firms in China exported their product to foreign markets although the average export value to these exporters was considerable. The output elasticity of capital was larger than for labor and with decreasing returns to scale in the Chinese coal mining and washing industry between 2007 and 2009.