NDRC Urges Coal and Power Companies to Sign Long-term Sales Contracts to Bolster Prices
Yicai Global
/SOURCE : Yicai
NDRC Urges Coal and Power Companies to Sign Long-term Sales Contracts to Bolster Prices

(Yicai Global) Nov. 2 -- China is to encourage coal mines and power companies to enter into long-term sales agreements to stabilize market expectations, and bring coal prices back to the normal level, National Development and Reform Commission said.

"Given the uptick in coal production, transportation and inventory, rising coal prices deviate from market fundamentals, and the general consensus among market players is that the price rise cannot be sustained, and effective actions should be taken to get coal prices back in line", an official at the bureau of economic operations adjustment of the NDRC said.

"Binding coal mines and power companies together with long-term agreements is a major step towards standardizing transactions on the coal market. Furthermore, the market will see it as a clear signal against unreasonable coal price increases, which will help stabilize market activity and coal supplies," the official said ahead of the national coal trade fair to held later this month in Qinhuangdao, Hebei province.

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