China will no longer set coal prices Mkt takes over with macro-control

China to reform coal price system
Source: CCTV.com
12-28-2006 10:38
The National Development and Reform Commission is reforming the country's coal pricing system, to allow the market to determine the prices.
The NDRC set the goal of next year's cross-provincial coal transportation volume at 738 million tons, with over 530 million tons for power generation. Its priority will be given to companies that measure up to certain criteria such as energy saving and environmental protection.
The government will no longer fix the coal prices. The coal and power companies may have more influence in terms of price-setting.
Ou Xinqian, vice minister of NDRC said: "We have changed the 50-year old system of government-set prices. Now the prices will be negotiated between miners and buyers under the state's macro-control."
Experts say because of the short supply and huge demand, coal prices may rise under the market-oriented price system.
Pu Hongjiu, deputy director of China National Coal Association said: "The charges for railway and shipping transportation are increasing, this will certainly influence the coal prices."
According to estimates, additional costs such as resources and environment cost will make increase the cost of coal by 70 to 80 yuan per ton.
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Editor:Li Yang

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