Data released today shows that China’s electricity production in October totaled 661 billion kilowatt hours.  This is down month-on-month by 22 billion kilowatt hours (-3%) but is up year-on-year by 21.6 billion kilowatt hours (3%).  The month-on-month decline is normal and occurs virtually every October.  Of more significance is the year-on-year growth.  Also of note is that industrial production grew year-on-year by 5%, and crude steel output grew year-on-year by 11%.

Hydropower output totaled 99.4 billion kilowatt hours.  This is up month-on-month by 400 million kilowatt hours but is down year-on-year by 20 billion kilowatt hours (-17%).  As we have been stressing in our research, hydropower output has been coming under considerable pressure due to low water inflow, and last month’s weakness has again come as no surprise.  The last three months have now seen China’s hydropower output contract on a year-on-year basis by 19%.

Coal-derived electricity generation totaled 445.3 billion kilowatt hours.  This is down month-on-month by 38.6 billion kilowatt hours (-8%) but is up year-on-year by 18.9 billion kilowatt hours (4%).  As with overall electricity production in China, coal-derived electricity generation normally declines on a month-on-month basis in October.  Year-on-year change is more noteworthy and the 4% growth is decent.

China’s coal production totaled 370.1 MMT.  This is down month-on-month by 16.6 MMT (-4%) but is up year-on-year by 13 MMT (4%).  As we have continued to stress, the government is no longer primarily focusing on improving safety and instead has shifted its focus to ensuring robust coal production.