Five more state-owned large coal miners in northern China's Shanxi province announced price cuts of 15-20 yuan/t, in an effort to rein in too fast growth in prices of the power generation fuel in the winter heating season.
The move, following Yangquan Coal Industry Group, which lowered FOB prices of thermal coal at northern ports by 15 yuan/t effective January 10, came as spot prices of thermal coal surged high amid a lack of supply and strong restocking demand from utilities.
The Fenwei CCI Thermal index showed that the FOB price of domestic 5,500 Kcal/kg NAR coal rose to 730 yuan/t, up 19 yuan/t from a week ago and rising for over 50 consecutive days from 671 yuan/t on November 17.
Shanxi Lu'an Mining Industry Group said it would cut power coal prices by 15-20 yuan/t from January 11, to help stabilize the market and curb rapid price increase.
It however, stopped short on the exact prices at which it will supply coal to power plants, or the price cut will apply to spot or long-term contract prices.
Shanxi Coking Coal Group, the nation's top producer of steelmaking coal, also cut prices by 15 yuan/t for thermal coal hauled by railway directly to power plants, effective January 11.
Shanxi Coal Import & Export Group, previously a major coal exporter in China, said it would cut prices of coal supplied directly to power plants by 15 yuan/t from January 11, while maintaining long-term contract prices stable.
Shanxi Jincheng Anthracite Mining Group also announced to cut prices by 15 yuan/t from January 11 for all its Jinyou, Jinbiao, Jinpu brands supplied to power plants.
Shanxi Jinneng Group, another major coal producer in the province, also said it would cut FOB price of power coal at northern ports, effective January 10.
The group also vowed to increase fulfillment of mid- and long-term contracts to ensure coal supply during the winter heating season.
So far, all the seven major state-owned coal producers, except for Datong Coal Mine Group, have announced price cuts and promised to ensure supply for winter heating, in a clear sign against the recent spiraling spot market.
Coal supply has been in tight for weeks at northern China ports, due to a lack of wagons available to haul coal from northern production areas. Coal demand for power generation and heating has climbed notably amid chilly weather after snowfalls hit most parts of the country.
The nation's top miner CHNENERGY and China National Coal Group are yet to make any announcements regarding their prices and supply of the fuel.
(Writing by Alex Guo Editing by Harry Huo)
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