China’s coal imports fell in December, slipping from November’s 11-month high, as domestic coal miners boosted output to record levels and utilities slowed the pace of replenishing inventories.

China, the world’s largest coal buyer, imported 30.95 million tonnes of coal in December, down 11.7per cent from November, figures from the General Administration of Customs of China showed on Friday.

That compares to 35.05 million tonnes in November and 39.08 million tonnes in December 2020 when Beijing relaxed import restrictions for some power plants to meet surging demand for heating.

“Coal imports slowed in December as domestic production improved,” ANZ analysts said in a note to clients, adding, “Slower industrial activity during the Lunar New Year could keep imports subdued till February”.

For full year 2021, coal shipments reached 323.22 million tonnes, the highest since 2013, and up from 303.99 million tonnes a year earlier.

Chinese traders have been slowing overseas coal purchases after domestic miners responded to Beijing’s call to ensure energy supply during winter by driving up output to a record high, while domestic coal prices more than halved.

Coal inventories have been falling as the winter heating season reaches the half-way mark.

“The usual trend is for power utilities to restock during the months prior to the lunar (Lunar New Year) vacations to ensure adequate inventories during the winter and by December restocking slows down after building stocks,” Justin Jose, coal analyst at Rystad Energy, told Reuters.

Rystad expects coal imports to bounce back in February/March.

Coal inventory at Chinese utilities exceeded 162 million tonnes on Jan. 21, or 21 days usage, about 40 million tonnes higher than the same period last year, the state planner National Development and Reform Commission said on its WeChat account.

Coal supply was guaranteed, the state planner said, even as coal inventories were “slightly fluctuating” from a record high of 168 million tonnes struck on Dec. 22, it added. They remained above 160 million tonnes, exceeding levels in the prior year.

Unlike the previous two years, China did not impose an unofficial imports cap in 2021 amid efforts to ensure stable coal supplies to ease nationwide electricity shortages and to tame runaway coal prices.

However, an unofficial ban on coal imports from Australia was kept in place.

China’s coal imports are expected to slide in January after Indonesia, its biggest coal supplier, suspended exports on Jan. 1 after its state power utility reported dangerously low stock levels of the fuel at its domestic power stations.

However, Chinese traders expect the impact to be limited as utilities are holding hefty stockpiles and power demand is set to weaken ahead of the Lunar New Year holidays, which start on Jan. 31.