The Vietnam National Coal and Mineral Industries Group (Vinacomin) plansto reduce coal production and consumption from 43 million to 39 milliontonnes this year, says Nguyen Van Bien, Vinacomin’s deputy generaldirector.
Bien said that the cutback, which is roughly the sameas last year, was due to a decrease in the demand for coal on both thedomestic and overseas markets.
He added that in the first fivemonths of this year, coal consumption was 17.7 million tonnes,approximately 41 percent of the yearly target.
The turnover of39.6 trillion VND (1.9 billion USD), represented a 5 percent reductioncompared to the same period last year.
Several industries havereduced their coal consumption, except for the power sector which hasalready used 7.08 million tones for generating electricity, an increaseof 6.1 percent against the corresponding period last year.
Theamount of coal used by the cement sector was 2.14 million tones, adecrease of 16.6 percent over the same period last year.
The group’s current coal stockpiles have risen to 7.1 million tonnes due to the sharp decrease in consumption.
The decrease is due to the worldwide economic downturn as well as theemergence of new energy sources, many of them renewable, being used byRussia and the US , which use 15 percent of the world’s coal,Bien said.
In addition, many countries that have their owncoal reserves have increased production for their own domestic markets.He said that coal prices in the global market had dropped sharply, whichhas had adverse effect on the group’s exports.
In the firstsix months of this year, the group suffered losses of 1.8 trillion VND(8.6 million USD) as the price of coal sold to the Electricity ofVietnam has only covered 85-87 percent of production costs.
It has also been seeking approval from the Government to apply differentlevels of tax to coal exports instead of the current 10 percent.-VNA