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Chinese coal railway freight under pressure

07-13-2012 09:45 BJT

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Coal inventories in China have been stuck at different ports in China, with buyers abstaining from purchasing coal due to the slowdown, leading to higher stockpiles of the resource. Now a new problem has emerged, railway transportation for coal is getting under pressure, with coal piling up beside railway tracks.

The Da Qin railway connects the coal transportation from the mines in central China to the distribution center on the north coast. But the recent coal oversupply in China adds pressure on railway freight. Tonnes of coal cargoes are still waiting for delivery on the side of the track, but their long-term distribution partner, the Qinhuangdao port is too full to store this coal.

A railway staff of Datong Railway Station of Shanxi Province said, "There’s no room for new rounds of coal cargoes on the other end of the railway, at the distribution center. So all the coal inventories are stuck here, waiting for a place to go."

Da Qin railway is designed to carry millions of tonnes of cargo. But due to the lack of demand, there are no transportation businesses. To put the cargo trains back on track...the administration staff is trying hard to find a coal buyer.

Lei Biao, Deputy Chief of Datong Railway Station of Shanxi Province, said, "We are trying some other cities now, maybe there are potential coal buyers there. Not sticking to one distribution center. Through which, the supplies and inventories of coal may be well digested."

Industry insiders say that the economic slowdown at home has squeezed demand for thermal coal in China, which was caused by overcapacity in coal’s downstream industries, including steel, cement, electricity and real estate industries.


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Editor:Zhang Jingya |Source: CNTV.CN

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