Hello, everyone. Welcome to China Coal Energy first quarter results announcement. Welcome to all participants. The meeting begins now. After the presentation, there will be a Q&A session. Now please join me to welcome the management.
Thank you. Dear investors and analysts, good afternoon. I am Jiang Qun, Board Secretary of China Coal Energy. Welcome to our results presentation. Attending today's meetings are Deputy Secretary of the Party Committee, Executive Director and President, Mr. Gao Shigang. Mr. Jing Fengru, Independent Non-Executive Director, Mr. Chai Qiaolin, Chief Financial Officer, as well as the head and staff from Security Affairs Department, Planning and Development Department, Corporate Finance Department, Coal Business Department, and Chemical Business Department, Power Business Department, and Marketing Management Office. We sincerely thank you all for your long-term care and support for the company.
Now I will brief you on China Coal Energy's operating results for the first quarter in 2026, and the main work arrangements for the second quarter. Unless otherwise specified, the following data are calculated on the Chinese accounting standards. In the Q1, the company resolutely implemented the decisions and deployments of the CPC Central Committee and the State Council, deeply pursue the development philosophy of improving efficiency from existing assets and transforming through incremental growth, and fully advance the various measures to stabilize production and sales.
Despite challenges such as changing geological conditions in some mines, we strengthen production sales coordination, enhance refined management, ensuring smooth and stable operations. Under Chinese accounting standards, the company achieved operating revenue of RMB 34,189 million, total profit of RMB 5,641 million. Net profit attributable to shareholders of RMB 3,844 million and d asic earnings per share is at 0.29. The main features of company's operation and production in Q1 are as follows.
Firstly, with the full efforts to stabilize production and sales with scientific approach, the company worked hard to overcome challenges such as changing geological conditions and increased difficulty in production. Achieving commercial coal production of 30.17 million tons, a decrease of 3.18 million tons year-on-year. We step up efforts to stabilize sales and ensure supply with commercial coal sales of 36.02 million tons, of which self-produced commercial coal sales were 29.7 million tons, down 2.98 million tons year-on-year.
For the coal chemical business, we coordinate safe production and plant operation, completing output of major coal chemical products of 1.554 million tons, including 373,000 tons of polyolefins, 537,000 tons of urea, and 524,000 tons of methanol, roughly flat year-on-year. Sales volume was 1.703 million tons, up 4.8% year-on-year. Second, strengthening quality improvement and cost initiative. The company dynamically optimized the production and cost control for logistics and sales. Unit selling cost of self-operated commercial coal was at RMB 278.76 a ton, up 3.3% year-on-year. Mainly due to higher labor costs from converting outsourced production teams to in-house operation with a higher social security.
A lower production sales volume led to higher unit material costs and depreciation and amortization costs. Other costs decreased year-on-year due to increased conversion of outsourcing to in-house operation and reduced outsourced stripping volume in open-pit mines. Benefiting from lower purchase prices of feed coal and the fuel coal, the coal chemical business saw unit selling costs of polyolefins at RMB 5,545 per ton, down 4%. Urea unit selling cost at RMB 1,318 per ton, down 1.8%. Methanol unit selling cost at RMB 1,354 per ton, down 4.2%. The major product prices stabilized with coal prices up slightly year-on-year.
The company's comprehensive selling price of self-produced commercial coal was at RMB 496 per ton, up by 4 RMB per ton year-on-year. Among that, thermal coal price was at RMB 465 per ton, up 11 RMB per ton, and coking coal price was at RMB 991 per ton, up by 69 RMB per ton. Coal chemical products prices continued to show diverging trends. Although polyolefin prices rose in March, the average selling price of the polyolefins in January to March was at RMB 6,274 per ton, down 8.8% year-on-year due to a significant decline in January to February. Urea price was at RMB 1,693 per ton, up 5.3%. Ammonia and nitric acid price was at RMB 1,813 per ton, down 2.6%.
Fourth, resilient operating performance and continued optimization of financial structure. Against the backdrop of lower coal production and rigid cost increases, the company adopted multiple measures to offset cost pressures and achieve the total profit of RMB 5,641 million, down 9.2%. Key factors include profit increasing factors, including an increase in investment income over RMB 169 million. A profit increase over RMB 158 million from the power business, and a profit increase over RMB 119 million from higher coal prices, and a profit increase over RMB 108 million from reduced taxes and surcharges. Profit-reducing factors included a profit decrease of RMB 661 million from lower self-produced commercial coal sales volume.
A profit decrease of RMB 254 million from higher unit selling cost of self-produced commercial coal. A profit decrease of RMB 67 million from the financial business. A profit decrease of RMB 52 million from coal chemical business, and a profit decrease of RMB 31 million from higher period expenses. The company continued to strengthen lean management and maintain good levels of our overall labor productivity and operating cash to sales ratio. Second, key work arrangement for Q2.
Since the beginning of this year, China's macro policies have been coordinated and intensified. Major project construction has accelerated. Investment growth has turned positive. The domestic demand market has steadily recovered. Export growth has exceeded expectations, and positive factors in economic operation have continued to increase. Q2 is a critical transitional period. The company will further strengthen production organization, refine measures to tap potential and increase efficiency, ensure that all operating indicators achieve all the milestone targets.
Firstly, we'll continue to strengthen production sales coordination to go all out to promote output and quality. Second, deepen lean management and cost control, tapping the potential for cost reduction. Thirdly, steadily advance key project construction, accelerate the implementation effectiveness of the Two Integrations. Fourthly, continuously improve our corporate governance and information disclosure quality, deepen communication with investors, and maintain good image in the capital market. Going forward, the company will adhere to the bottom line of safe development and unswervingly pursue high-quality development. Thank you, all. Now we're opening the floor for questions.
Hello everyone. For attendees joining us online, please click the rise the hand button. Again, if you need to ask your questions and you're joining through phone call, please press the asterisk key on the phone pad and then press number one. Now, investors with the tail number nine, six, nine, two, please don't forget to share us your name and institution.
Okay. Thank you all management. I am Song Chu, an analyst from Changjiang Securities. I have two questions. Firstly, in Q1, for the thermal mines and also for the coking coal, prices have increased. So what is the reason behind that? And what is the continuity for these two products? Is it going to be consistent?
Okay. We'll try to address the answers one by one. We'll ask [Mr. Li] from our marketing office to address these two questions.
Thank you for your question. In 2026, China Coal Group and also China Coal Energy, our overall sales structure and marketing system remains consistent with 2025, but the pricing has registered some changes. From January to March, the price has increased from less than RMB 700 to RMB 780. By the end of March, I think it's around RMB 750. The long-term agreement prices is about RMB 8 lower than Q1 last year. For the spot market price, last year, it was turning down, but this year it is turning up.
The spot market price is like RMB 13 higher than same period last year. In 2026, there were some changes in the sales structure, in terms of the long-term agreement sales and also the product structure, the product mix has also changed. Because we have a lower sales proportion from our long-term agreements, and also the long-term agreement pricing is different from last year, by the difference of RMB 8. For the spot market, the price is RMB 13 higher. That's why the overall pricing is better.
In 2026, again, because of the lower long-term agreement volume and higher spot market pricing, normally in a Q1 the market was not very good and the price should go up or is something that we could look forward to by optimizing the management or by optimizing the contractual structures. It's going to be sustainable.
Okay, thank you. For my second question, it's about the coal chemicals. In the single quarter, the quarterly pricing has turned it down. For methanol and also for polyolefins, actually the overall prices have increased a lot. What's your take on the magnitude of profitability increase for March? Any guidance on the profit, profitability improvement? Are there any guidance for the annual profitability improvement for the chemicals? Can you help us to break it down?
Sorry, let me repeat your question. You mean that our expectations of the profitability generated by the coal chemical business? Is that the question?
Yes. I mean, like a quarter-on-quarter basis, how much will it be improved?
Okay. Let me address this question. In a previous presentation, it's been mentioned that in March, the coal chemical price has come down mostly because the coal chemical price was at a low level from January to February. But for well-known reasons, in March, the coal chemical price has increased because of the new market landscape. That's why the company's coal chemical product prices have increased.
However, on average, the overall pricing from January to March was not as high as expected. Later on, I could ask the finance people to break down the profitability for the coal chemicals for Q1 and also for March. Regarding the future outlook, but especially from this moment to end year, like the trend of profitability for coal chemical, it's fair to say that it's highly subject to the market environment and also the international landscape, so it's really hard to say. Regarding how the coal chemical price will trend, I could also ask colleagues from marketing office to share more about it. Okay. I would ask our colleague from the marketing office to share his views about the pricing trend for coal chemical.
Okay? Thank you for the question. In the 2025 annual results announcement, we have made some comments regarding the supply and demand landscape and dynamics in 2026. The overall impression is that the supply and demand for coal chemical in China, there's oversupply. The energy pricing would have a short-lived impact or unsustainable impact on the coal chemical business. There are different opinions regarding international conflict. Some say that it would end within three months and some say within six months. Some say that it will go beyond six months, so a ll of these will affect the crude oil price.
If the conflict will last for over three months and the crude oil price maintains like over 80, then that means the energy pricing system would be relatively strong and that will also affect the demand for the coal chemical products. From March to April, the coal chemical pricing has increased by like up to 40%. This week it has gone down by a few RMB 100. Down by 3%-5%, which is aligned with market expectation.
That is why we expect the pricing to be kept at an elevated level. That's the trend. Having said that, we do not expect the high pricing level to be sustained for very long. Higher pricing, it's a trend, but it won't be extremely high. About the profit margin for the coal chemical business in March, I will give the floor to Ms. Xu.
Total margin is about RMB 300 million for coal chemical. For urea, polyolefin, each accounting for RMB 100 million. You're telling me the gross margin, is that correct?
Okay, thank you. Well, so much for my questions. I wish China Coal to achieve even better performance.
The participants with a phone number ending in zero, six, zero, zero, please name yourself and your institution. Thank you. Can you hear us? Please raise your question. Thank you. Okay. While we're waiting for this participant, let's give the floor to another one. The investor with a phone number ending in eight eight zero eight, please name yourself.
Thank you for this opportunity. First, I want to say congratulations to China Coal Energy for your excellent performance. I have two questions. It's more of a follow-up question. Previously you said that in Q1, in our thermal coal and you had higher sales in a more premium variety. In the annual report, if I remember correctly, in 2025, your calorific value in 2025 is up by 200. In Q1, the thermal coal's pricing in general is going down. Do you expect even more improvement in your quality of coal for a high calorific coal? Do you give it higher weight? Do you expect that to happen?
Question number two. Since we have the coal chemical business and many other players, they also do this, and they need to have some maintenance and repair sessions. For now, the margin of coal chemical business is buoyant. In the coming quarters, do you expect some maintenance or repairing sessions that could affect that could drag down the scheduling and manufacturing for some products? That's my question. Okay.
About the pricing of our coal, yes, it's true, we have been improving the coal quality. In Q1, the average calorific value of our coal was improved by 100, giving us RMB 27 more per ton, and that raised the average selling price of our coal by RMB 16. Based on what [Mr. Li] has said about how the general pricing is going down and how we have a different portfolio, lower in LTA and the changing price, that is why you see the price we got. In the future, we will continue to improve the quality of our coal. We will set a higher price for the more premium coal.
As for the quality of the coal and its boost to our profit margin, how sustained will it be?
It depends, because we have started this measure starting from last year. We already saw the improvement in quality, but the longer it is in place, there will be less of the marginal impact, marginal improvement to our margin. About the coal chemical maintenance and repair session, I will give it to my colleague.
Thank you. For the repair and maintenance session for coal chemical, we don't have a lot of that sessions scheduled. The main task is about the ammonium nitrate, and it only took place in April, and it was back in operation in 8 May. It's totally had a reduction of the manufacturing for 30,000 tons, but no other repair sessions for either urea or the other products.
Okay. Thank you for answering my questions. I wish China Coal Energy to have better results to show for.
We will give the floor to the participant whose phone number ends in 5907. Please name yourself.
Thank you for this opportunity. I'm from CITIC Securities. I'm Zhao Bolin. I have two questions. The first one is about coal costs. In your Q1 report for the in-house coal you have reduced the use of the outsourced work. That is why there is less of the expenses there. We don't see other expenses being affected, so I wonder, will it also affect? Will it still affect your cost in the future? And what's the magnitude of the impact from this outsourcing alone for this year? Thank you.
Okay. Ms. Xu from the finance department.
In our other costs, the Q1 specialty fund use is lower than last year. The specialty funds and the use of it's based on the rules and regulations strictly. About the mine underground safety infrastructure and the improvement, those requirements, those actual needs on the ground will determine how much we use those specialty funds.
Question about coal chemical costs. I've seen how the unit cost in Q1 for polyolefin has been trending down. For the raw material cost and also the selling price of the coal, it has been trending up. I want to know more about your lower production cost. How can you cut the cost like this? How will the feedstock expenses change in the future? Thank you.
Well, Mr. Jiang has said already for our price, higher selling price of Pingshuo Coal, we have improved the product mix, and we have better coordination of production and sales, and we improved the coal quality. That's how we are charging a higher price. But for the spot price is in line with the market trend. As for the chemical feedstock procurement price, it's also reflected in there too.
Question You have higher selling price because you have a more premium coal. As for the chemical pricing, you fluctuate with the market trend, is that correct?
Mr. Jiang Qun is saying we have said explicitly our in-house coal has a higher price. It is affected more by the Pingshuo Coal, because the Pingshuo Coal accounts for a very big chunk of our sold coals, the coals that we sell to the others. For the coal chemical raw material, we source it from Yulin and Ordos. It's different from the Pingshuo Coal. We use the coal sourced locally from Inner Mongolia, Ordos and Yulin. Part of the coal we use for the coal chemical business, it is... Part of it is from our own in-house production, and the others is from the third party that we procure from, other vendors. Whether it's in-house coal or, procurement from third parties, it's all market-based. That is why the pricing trend it deviates from the with our selling price.
Okay. Crystal clear. Thank you.
Investor, whose phone number ends in 6402. The floor is yours.
Greetings, everyone. I'm from Xinshan Securities. I'm Wang Junshan. I have three questions for the management team. Our Q1 coal production is down on a quarter-over-quarter basis, so I want to know the factors reducing our production. Has it blown over yet? Can we recover the lost production here so that we can have flattish production on a year-over-year basis?
Question number two: What is the situation with our long-term agreement here? For some of the coal manufacturers in Shanxi and Inner Mongolia, they're pricing their products based on the NDRC, but others, they are pricing their products based on each pit with the clients. So, for the long-term agreement, for some pits, how do you price your products? Question number three: for the investment return, you have gained more than RMB 100 million. It's different from the general market trend. In Q1, your pricing for coal has also grown. So my question is that for the investment companies, for the companies that you have invested in, have they got better quality in yield? And is that why you have better investment yield?
An answer. For your first question about the production and whether we can recover the lost ground, I will give the floor to Mr. Jing.
Okay. Thank you for your question. In Q1, because of the geological environment changing of Pingshuo, and also since we have more of the outsourced labor to in-house because of these changes, we had some production reduction. For Pingshuo and Xibei companies, their working environment has gone back to normal. For the other location, it is still being affected. For the next step, we will do what we can to make sure we can have the normal production and repair to try to produce even more than our numbers last year.
Mr. Jiang Qun is saying we have disclosed to the market our production plan for commercial coal, and we will try to go by our plan and even overshoot our plan. But still, for your investment, please base your calculations on our production plan for your model making. As for the pit level LTA pricing, I'll give the floor to [Mr. Li]. Okay. Thank you for your question.
Thank you for the question. In 2026, the NDRC has a very clear guidelines about the long-term pricing. It's going to be consisting of a benchmark price plus dynamic pricing. This is also subject to supply-demand dynamics based on their willingness and their consent. We have also followed this model, long-term price benchmark pricing plus the dynamic pricing. From January to March, basically, we are using the upper limit of the guide price. Also we have taken reference of some pricing indicators without major adjustment.
Compared with 2025, in 2025, the long-term pricing has been quite volatile, which has led to the difficulties in executing these long-term prices. This year, based on the existing long-term pricing system, we have established some additional mechanisms and special pricing depending on the market situation and also in a few certain regions. That's all. Okay.
Thank you. That's very clear.
Yes. The third question is about the ROI. I would ask our finance colleague, Ms. Shi to address the question.
Okay. In the Q1, the investment income has increased by RMB 169 million. This is mostly because of the profit gains of the companies that China Coal Energy is a shareholder of. For example, the Zhongke Hechong company, the sales and production volume has increased by RMB 68 million. Also one of the other companies, Huajin Coking Coal, in the Q1, the production sales volume also increased by 40%. The overall investment income of the company has increased as a result of it.
Okay. Got it. That's very clear. My best wishes to China Coal Energy for the future performance. Thank you.
Next, investor with the tail number of six three two two, please name yourself and institution.
To your management, I'm from Citi, a Raw Material Analyst. My name is [Fong Shan] , and thank you for organizing this earnings call. I have a few questions. First, previously, the management has talked about the Q1 projections, it might go down. So what is the proportion of the thermal coal out of the total coal sales? And whether that proportion will fluctuate throughout the year or will there be any seasonal changes? This is my first question.
Okay. I would ask [Mr. Li] from our marketing office to address the question.
Thank you for this question about the long-term contract signing. So the NDRC has strict stipulations about the signing of long-term agreements in 2026. The principles remain the same with 2025. The cap is at 75% of the production volume. Considering the demand in 2026 for thermal coal and also in 2025, the actual signed volume has not reached the designated volume. NDRC has made some adjustment about the volume and proportion. I can't disclose the exact numbers because it's related to the state plan, but it has gone down a little bit.
For the fulfillment of a long-term contract, NDRC has also very clear requirements. It's going to be delivered in a balanced manner from January to March, facing such a supply pressure. Our long-term fulfillment has also surpassed 90%. Throughout the year, the fulfillment rate will be over 90%. Maybe there could be monthly fluctuations, but nothing major. Because China National Coal Group has very strict execution plans about these long-term contracts and also with a very stable supply-demand relationship. There won't be any major changes in that regard
Okay. Thank you for the answer. That's very clear. Second question is about cost. Just now the management has explained the changes in cost. For the overall production cost, what will be the projection going forward? Also in 2026, how will the cost be different from 2025? Are there any guidance and breakdown for the quarterly prices?
Okay. Regarding the cost this year, the cost has increased by 3.3% year-on-year, mostly because of the volume changes. 60%-70% of the asset-based costs are rigid so it's not very scientific to expect it to go down all the way. We're also implementing cost initiatives. We are strengthening the control of the production process and to empower the production with technology, as well as strengthening the cost control for equipment. The company is stepping up the investment in safety and environmental protection, as well as some smart and intelligent features. Currently, the company's cost is at a relatively low level, and in 2026, we will continuously implement the reasonable cost initiatives.
Understood. Can I ask a follow-up question? So in 2026, the annual cost maybe will be like similar to the Q1 level, but it will be higher year-on-year, right?
We can't give a very precise forecast about the overall cost in 2026. But just now, Ms. Shi has explained the projection. Compared with 2025, the cost is at a lower level. It's unlikely for the cost to continuously go down, because some costs are rigid, and it's really hard to reduce it further.
Okay. That's very clear. I don't have any other questions. Best wishes to the company.
Next.
Dear management, I am Wang Tao from Oriental Wealth Securities. I have two questions. Firstly, just now, Mr. Zhang has mentioned that the thermal value of some poor mining area has increased by 100 calories. What is the current calorific value of these mines, a nd whether these calorific value increase is going to be normalized or not? I will ask a question one by one.
Okay. For our main product, the calorific value is about, like 4,500, give and take. Based on the market demand and also based on the geological conditions, it will fluctuate. The 100 calories is an increase on a year-on-year basis. As mentioned earlier, within this year, that number is likely to change because we are strengthening the coal quality management, and these measures have been implemented since last year. As time goes by, in other words, in the second half last year, there were some good outcomes. When we disclosed last year's annual financial statement, we have pointed out that the coal quality has improved last year.
We have improved the results, and we have also produced the high grade coals like for the 5,000 or 5,500 coal. That's why the overall coal quality and coal grades have improved. For this year, particularly for the second half, whether the year-on-year increase will maintain such a magnitude, that's unlikely. Because in Q1, the year-on-year increase could still be quite significant, but after Q1, I think that trend would be moderated. Again, this is subject to the market landscape. The coal quality changes is related to the geological conditions and also is related to the product mix. We are prioritizing the coals with a high calorific value. That means that the overall production volume might go down slightly. We are looking for the sweet spot based on the market dynamics.
Okay. That's very clear. You mentioned that these measures started to be implemented in the second half last year. Is it from Q2 last year, or from what date?
Okay. Let me put this way. We started to formulate measures like early last year, but as time goes by, there are the results becomes more significant.
Okay, that's clear. My second question is also about cost. The cost variations in Q1, the cost remains relatively high. As we release more capacity, there are some room for cost to go down further. That's normally what could happen. Do you think that this pattern will remain this year o r, will this year's cost breakdown be more evenly distributed throughout the year?
Thank you for the question. In the Q1, the cost was high because of lower production volume. So the unit cost has increased. The cost fluctuation pattern is quite consistent throughout the years. We are also striving to balance the quarterly costs.
Let me add some additional comments. In Q1, the costs tend to be higher, because in the onset of the year, we have put up some efforts to organize our production. It's also possible that in the Q4, the costs could rebound. We are striving to balance the cost throughout the quarters, but it's nothing definitive. Thank you.
Thank you, Zhang. I wanna ask a follow-up question about the industry, about the coal chemical and also for the potentially newly approved projects. Any hints about the progress of these new projects? Is it going to be more relaxed? Are you talking about the Pingshuo coal chemical project? I didn't get that.
Yes. It's the new coal chemical project, not the Yulin Phase II project. Okay. I would ask my colleague from the coal chemical division to address the question.
Okay. For the Pingshuo project, we are still actively driving this project forward. Based on the latest requirement from NDRC, we are very active to optimize our plan and also to refile the materials. We're trying to submit the third declaration materials to NDRC in June.
Okay. Thank you all. That's all from me. Best wishes to China Coal Energy.
Okay, this question has been typed in. The company has raised the concept of improving efficiency for existing capacity and for the Liquid Sunshine project in Yulin. What's the progress and what is the expected efficiency? For the capacity expansion plan, how far have we gone, and what is the CapEx spend here?
For the Liquid Sunshine project, we are carrying it forward. The original plan was to put it into operation by the end of this year, and it looks like we can get it done. As for Phase II of Yulin, it is being built as we speak. Our schedule is to again put it into operation by the end of this year. But aside from the EVA equipment, it will be used. It will be put into operation in 2027. But for the rest of the installations, they could go online at the end of this year. About the renewable energy development, I will give the floor to Wang from the electricity d epartment.
As for the 7 million renewable energy plan, the group level and the different departments, we are carrying out the project. Through the restructuring, M&A, and through our own building, we have confidence to complete the 7 million target this year. Thank you.
Thank you. The next question is that in Q1 our thermal coal sales was down by 2.96 million tons, but we have more better improvement in margin. What is your Q2 target? What's the progress for trading coal? Thank you.
Would you mind repeating the question? Are you asking more about the trading coal?
Okay, here it goes. In Q1, the in-house coal sales was down by RMB 2.9 million and less revenue from the trading coal. You have better margin in Q1. Next, what's your plan for cost control and sales improvement? And what's your product mix plan? And what's your target for Q2? Thank you.
Answer. My understanding is that you're asking about the trading coal. If that is correct, then the sales of trading coal changes is the topic here. Okay. Let me address the sales expectation for trading coal in the coming quarters. Well, for cost control, we have already covered that, but I will ask my colleague to repeat the answer.
Okay. Thank you for the question about our trading coal. Over the years, for the trading business of coal, we have stepped up our management, especially after the policy measures about the trading coal. We have beefed up our procurement and risk control. Although the volume for trading coal has gone down a little, but for the margin and for the business, for the risk control, we have done better and we are sourcing more directly. We have made good progress here.
For trading coal in 2025, the volume has shrunk a little. After a year's adjustment this year, the trading coal's structure and margin has more stabilized and we expect that trend to hold. About cost control. Commercial coal cost has gone up in Q1. That's because we had less production. For the in-house coal production, 60%-70% of that is inelastic. For the more variable controllable costs, we could further do cost down, and we could better control the costs from the sources and also the cost during the manufacturing process. We would have strict control of all the expenses, and we would use more advanced technologies to improve efficiency. That's how we intend to do cost down. For now, our cost is already kept at a very low level, and if there's any cost changes, it must be aligned with our manufacturing demand. In 2026, we plan to continue our very scientific and strict cost optimization. Thank you.
Thank you for the answer. The next question for the management is, what's your plan for the capacity addition during the 15th Five-Year Plan for coal production? Thank you. Answer. From strategy department, Mr. Zhang.
Okay. During the 15th Five-Year Plan, we expect a smooth capacity addition pattern in mid-15th Five-Year Plan. For the newly built coal mines that they will have to fully ramp up, and by then we will have a very smooth. Based on the market conditions, based on the government requirements and LTAs, we will schedule our production. By 2027, we expect RMB130 million. 2028, RMB 135 million. By 2029, RMB 140 million. By 2030, RMB 150 million. Thank you.
Mr. Jiang Qun is saying, let me add that these plans are only based on the designated capacity of our mines being built. The estimation is based on that. It doesn't represent the actual production plan. I ask all the investors to base your calculations on the numbers that we disclose from each period. Okay.
Next question is about the utilization rate of our coal chemical business. How high can it be? Answer.
Well, over the years, our utilization rate has been 100%. It has never gone above 100%, and the maximum level could be at 110% of the designated capacity. Thank you.
Thank you for the answer. Next question is about how the CapEx of the company has gone up. You are doing industry upgrade and renewable development. What's your CapEx for the year and how do you strike the right balance between the liquidity and shareholder payback? And do you expect higher payout ratio in the future? Answer.
Two aspects to this question. I will give the floor to Mr. Zhang from the strategy department to walk you through our CapEx and our plan for the future, and I will answer your question about the cash dividends. From Mr. Zhang.
In 2026, we have planned RMB 21.3 billion of CapEx for coal, electricity and coal chemical. We have some of the projects being built and some other new projects. If we make key progress in the polyolefin projects, we will disclose it in a timely manner. For the 15th Five-Year Plan, we are making the high level plan here. If there is anything new here, we will disclose it as soon as possible. We have about, again, RMB 20 billion of CapEx plan for the 15th Five-Year Plan. About the future payout, China Coal Energy has set store by the shareholder return.
We have always had a payout ratio of above 30%. Based on the capital market expectations in the recent years, we increased the payout ratio from 30% to 35%, and we have more frequent payouts. We have not just the annual payout, end of the year payout, we also have the interim payout so that we can better answer the expectations from the investors for shareholder return. Considering our long-term development needs, since we want to expand further and make us an even stronger manufacturer. In the recent terms, we are highly likely to keep the payout ratio at the current level. Thank you.
Next question. Our coal chemical business in Xinjiang and also coal production. Do you have any new plans to produce coal and do coal chemical in Inner Mongolia?
About the Xinjiang coal chemical business, we are now studying the feasibility of conducting coal chemical, especially coal to synthetic natural gas business. We are doing a feasibility study here in Xinjiang. Mr. Zhang Guoxiu is saying our coal chemical study is being conducted. The feasibility report is being conducted. As for whether it will receive the green light or not, please refer to our final disclosure. Whether it's a coal to olefin or a coal to synthetic natural gas, we haven't really made the final call. Mr. Zhang from the strategy department. Answer.
Whether it's for Xinjiang or Inner Mongolia, we have got the coal reserves, coal resources. The development of those reserves will go through the SOP. We will get the approval, and we will go through the review process. The review process is ongoing. We are after getting the review and the approval from the local authorities, we will make the disclosure. Aside from our existing resources being developed, we are also planning to source other resources from the market. All the resources, even the government-related resources, will go through the market-based tendering process, and the decision will be made by our board. If there's any progress, we will report to the capital market.
Next question. So what is the year-over-year production volume change for Dahaize?
For the Dahaize coal mine, the scheduling of production is based on the number of 60 million tons. That's the plan.
Okay, thank you for the answer. Well, let's wrap up the Q&A session here. Any final remarks from the management team?
Well, thank you for the participation, dear investors and analysts. In the interest of time, let's wrap up here. If you have further questions for us, please reach out to our IR department. We're happy to have further communications with you. Thank you.
Okay. Thank you for your time, dear investors and analysts. Take care. Bye.