OREANDA-NEWS. Heavy rains in north China's key coal producing Inner Mongolia region last week disrupted coal mining and transportation in Erdos, where many open-cut and underground mines are located. Tighter supply from mines in the region has helped to push up coal prices.

Fob mine prices of NAR 5,500 kcal/kg coal produced in Erdos rose by around 8 yuan/t ($1.20/t) from a week earlier to Yn224-230/t on 19 August, according to the Inner Mongolia Coal Exchange Centre.

The exchange centre — founded with the support of China's coal industry association and the Inner Mongolia government — is the only coal exchange approved by the region's government. The fob price is a component of its weekly Erdos steam coal price index, which rose by 2.17pc to Yn235/t at the end of last week.

Heavy rains since 14 August have flooded open-cast mines in Erdos, forcing almost all such mines to close temporarily. Most of the underground mines in the region have also had to shut to avoid flooding or mine collapses.

There are 153 operating open-cut mines and 174 underground mines in Erdos with a combined production capacity of 742mn t/yr, according to data released by the local coal industry bureau in January. But the bureau has not disclosed the capacity of the mines that have been adversely affected by the heavy rainfall. Inner Mongolia produced around 405.5mn t in the first half of this year, according to data from China's statistics bureau.

Rainfall in several parts of north China has been around historic highs, with levels in Erdos reaching as much as 150mm during 10-18 August, China's national meteorological administration (CNMA) said.

Heavy rainfall should ease gradually from today, CNMA forecasts indicate. But prices may continue to be supported if utilities seek to rebuild stocks quickly after coal mine operations and transportation return to normal.

Coal mines in several regions in China were affected by heavy rainfall this month. Coal trucking operations from the key coal producing counties of L?liang and Yangquan in Shanxi province were impacted earlier in August when local authorities closed several highways after a road collapse resulting from a storm.