China's state planner sees further room to adjust coal prices
By Shivani Singh and Min Zhang
BEIJING, Oct 29 (Reuters) - There is still room for China to further adjust coal prices, the country's powerful state planner said on Friday, after futures prices fell more than 9% on its investigations into producers.
In a statement, the National Development and Reform Commission (NDRC) said, "Initial results showed coal production costs are significantly lower than current spot coal prices."
The most-traded thermal coal futures contract on the Zhengzhou Commodity Exchange fell as much as 9.18% to stand below 1,000 yuan ($156.45) per tonne in early trade.
The contract last traded at 975.6 yuan per tonne, having fallen more than half from its record high of 1,982 yuan on Oct 19. It is up more than 80% this year.
On Friday, the environment ministry said it would take steps to cut the concentration of tiny hazardous airborne particles known as PM2.5 by an average of 4% on the year in main cities this winter.
The world's top greenhouse gas emitter's anti-smog programme is likely to face scrutiny this winter as a power crunch forces the government to secure more coal to generate electricity.
Beijing's measures to cool prices of the key power-generating fuel include stepping up output in coal producing regions and setting a target price of thermal coal.
The power crunch has forced power-hungry industries such as steel, aluminium, cement and chemicals, to cut production, while a new electricity tariff is expected to bring higher costs and put pressure on profit margins. ($1=6.3917 Chinese yuan) (Reporting by Min Zhang, Shivani Singh and Gabriel Crossley; Editing by Sam Holmes and Clarence Fernandez)
