China wants to boost domestic coal output capacity by about 300-million tonnes in a bid to become self-reliant. Picture: BLOOMBERG
The National Development and Reform Commission , the country’s top economic planner, asked power generators to sign long-term supply contracts with domestic miners and build stockpiles to last at least 15 days, according to people with knowledge of the matter. The move was effective from Friday, when the commission summoned major coal and power suppliers for a close-door meeting, the people said.
China is requiring miners to offer 80% of their production through long-term contracts at prices capped by a government-set benchmark, the NDRC said in a briefing after the meeting on Friday. It said local officials must monitor all the transactions to prevent dealers cheating with dual contracts. Some energy providers may have sufficient supplies for the 15-day requirement. However, the mandate comes amid depleted inventories and transport constraints because of Covid-19 curbs, which have sent spot coal price higher. The average spot thermal coal transaction at northern ports rose to 1,707 yuan a tonne, based on the data composed by the China Electricity Council.
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