China's raw coal output slid in October, curbed by operation suspensions, safety checks, and persistent rainfall in producing areas.

China's domestic coal market gained the most significant momentum over the last two years, with thermal coal even bucking its seasonal downward trend, mainly driven by better-than-expected improvement of demand and tightening supply.

However, raw coal output turned downward during the month. According to the National Bureau of Statistics, China's coal output stood at 406.75 million in October, sinking 1.16% from September and 2.3% from last year. The daily coal output averaged at 13.12 million tonnes, dropping 4.37% on the month and 1.2% on the year.

The import volume posed a similar trajectory. The country imported 41.74 million tonnes of coal in the month, declining 9.75% year on year and 9.27 month on month, showed the data released by the General Administration of Customs. By contrast, August and September's imports saw month-on-month increases of 20.02% and 7.64% respectively.

Following the production suspensions during the National Day and Mid-Autumn Festival holidays in early October, coal miners saw stricter safety inspections and struggled to resume production, leading to limited capacity utilization.

Meanwhile, October witnessed extreme rainfalls nationwide. The persistent rainfalls hit northern China, disrupting production and sales at open-pit coal mines in the region.

In addition, with over-production checks ongoing until the year-end, as well as typically stringent safety inspections in the fourth quarter, some mines with overproduction and safety hazards halted production for rectification, leading to reduced output.

With these factors at play, coal miners adopted a cautious approach and slowed down production in October, limiting the coal output.

In November, weather impacts may lessen significantly, and ensuring coal supply will become the top priority, driven by the full-scale launch of winter heating in northern China and cooling temperatures in southern regions.

Moreover, under the heightened safety scrutiny of the fourth quarter, the impact of safety inspections is likely to be relatively limited.

Therefore, even with factors above creating uncertainties for raw coal output, the probability of month-on-month growth remains high in the coming months.