China's coal-mine deaths rose to the highest in at least five months in November, as owners of small pits and local authorities resisted government closure orders.

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More than 150 accidents killed 420 miners during the month, the State Administration of Work Safety said on its Web site this week, as pit owners stepped up output to tap winter demand. Disruptions to supplies caused by blasts and flooding at mines may contribute to higher Asian prices, according to a Citigroup Inc. report.

China has pushed back by two years a 2008 deadline to close coal mines considered unsafe or too small to be efficient, because of opposition to the plan, the official Xinhua news agency said Oct. 12. Reluctance to obey this decree underlines the conflict between satisfying soaring energy needs and improving one of the world's worst mine safety records, said researcher Michael Zhang.

"A lot of local governments count on small coal mines for revenues and are reluctant to shut down the pits," said Zhang, a Hong Kong-based researcher at China Labour Bulletin. "Closing them is very tough."

Accidents in China's coal mines killed 5,986 workers in 2005, a fatality rate of 2.836 for every million metric tons of the fuel mined, according to the work safety administration.

Coal Shortages

China Shenhua Energy Co., China Coal Energy Co. and rivals in the world's largest producer of coal used by power stations are failing to keep pace with demand as mine failures reduce supplies, Citigroup said.

Mine accidents in Taiyuan, Datong and Linshi in Shanxi province, and at Leiyang in Hunan have killed as many as 100 workers, and led to shortages of coal at coastal power stations in China, Citigroup analyst Alan Heap wrote in a Dec. 4 note.

Chinese exports of coal have fallen by 14 percent this year to 44.3 million tons, and the mine failures could cut exports further, he said. Chinese demand for coal will rise 10 percent this year, and its power stations are now restocking ahead of winter.

"More than usual, China is energy-hungry," said Heap, who had forecast Asian contract prices in 2007 at $50 a metric ton, down from $52-$53 this year. The failures could result in a higher price, he said.

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