China to revise coal law to reinforce marketization Policy 2020-07-31 14:15:04

China's state planner on July 29 issued a draft to revise the coal law, to further improve the market-oriented mechanism.

The National Development and Reform Commission, the state planning body, pointed out "the state should establish and improve the mechanism for determining coal prices by the market, and encourage launching and publishing price indexes in key coal production regions, coal receiving regions and transfer ports to provide reference for participants."

Compared with the existing version, the draft also adds other new provisions about coal supply chain, import and export, transport, etc.

The draft proposes to strengthen monitoring, early warning and operational adjustment to ensure the entire chain – from production to supply, storage and sales – working safely and steadily.

It supports to improve the coal storage system with end users as the main body, local government as supplements, and encourages miners, transporters and users to sign medium- and long-term contracts.

The NDRC supports the import of high-quality types as supplements to domestic supply, and pledges to fend off inferior imports out of the gate.

Currently, the NDRC adopts strict rules to rein in seaborne thermal coal imports, but shipments of coking coal seem little affected.

In June, according to customs data, imports of lignite fell to 7.04 million tonnes, down 10.7% from a month earlier, while coking coal imports increased 30.7% to 6.26 million tonnes.

In terms of transportation, the draft proposes that local governments at or above the county level should promote construction of coal transportation channels and supporting facilities. The state guarantees the railway transportation under medium and long-term contracts.

The draft also deletes clauses incompatible with current development of the industry, like ensuring the development of state-owned coal mines and supporting township coal mines, etc.

The existing coal law was first launched in August 1996, and was revised three times afterwards. The current version came into force from November 2016.

(Writing by Alex Guo  Editing by Jessie Jia)
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