You are here

China's state planner to meet with coal industry on supply, prices

Thursday, September 22, 2016 - 19:47
39080733 - 15_07_2016 - CHINA-BANKS_DEBT-OVERCAPACITY.jpg
China has called regulators and company executives from the country's major coal producing regions to an "urgent" meeting on Friday, the second in as many weeks as Beijing tries to overhaul the industry while maintaining supplies to major consumers.

[BEIJING] China has called regulators and company executives from the country's major coal producing regions to an "urgent" meeting on Friday, the second in as many weeks as Beijing tries to overhaul the industry while maintaining supplies to major consumers.

China is trying to cut inefficient coal production as part of efforts to reduce pollution and trim excess capacity. But tighter supplies and increased consumption during the summer have pushed up prices.

In a letter dated Sept 22 and seen by Reuters on Thursday, the National Development and Reform Commission (NDRC) scheduled the meeting in Beijing for regulators from China's top three coal producing regions, Shanxi and Shaanxi provinces and the autonomous region of Inner Mongolia.

Executives from Shenhua Group Corp and ChinaCoal , along with the China Iron and Steel Association (CISA) and the China National Coal Association will also attend.

Participants will discuss the industry's "latest problems"as well as supply and demand in the following months, it said.

"We will study and analyse the latest outlook in coal production, transportation, demand, price and problems," the NDRC said.

The NDRC did not repond to Reuters' calls seeking comment.

It is not clear what will be decided at the meeting, but CISA sent a request to the NDRC earlier this month pleading for more supplies of coking coal used for steelmaking, according to a document seen by Reuters.

The recent production cuts that are part of the NRDC's efforts to get rid of inefficient coal output have choked off supplies of raw material to domestic steelmakers.

At an industry meeting two weeks ago, producers discussed increasing thermal coal output, partially reversing those cuts, but measures have so far not included coking coal.

Friday's meeting comes just days after some major producers including Shenhua started ramping up output, putting up to 15 million tonnes of new supply each month on to the market.

In its letter to the NDRC, CISA noted that coking coal prices have soared 20 per cent in the past two months, while imports have climbed sharply.

REUTERS