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Temporary controls are lifted
By Fu Chenghao |
January 1, 2009, Thursday
|
Print Edition
Print Edition
CHINA has lifted price controls on liquefied petroleum gas, thermal coal and other commodities from today.
The National Development and Reform Commission introduced temporary curbs on prices for a range of products from foods to LPG in January last year to tame inflation. Food products, including vegetable oil, pork and eggs were freed from controls last month.
The price controls on thermal coal, used for power generation, were imposed in June when the government stepped in to help power plants cope with surging coal costs and ensure a stable energy supply.
But coal prices have fallen sharply in recent months, now below the price caps, with a decline in demand from the power sector due mainly to weaker manufacturing activities.
In the annual price discussion on this year's coal contracts which ended last Saturday, miners and China's top five national power companies failed to sign a single deal as the two sides' positions were miles apart. Coal-fired power firms, which were expected to lose 70 billion yuan (US$10.26 billion) last year, insisted term prices should fall as demand growth dropped. Coal producers demanded a rise of up to 10 percent to reflect higher tax and to make up for losses because of the state price controls.
The National Development and Reform Commission introduced temporary curbs on prices for a range of products from foods to LPG in January last year to tame inflation. Food products, including vegetable oil, pork and eggs were freed from controls last month.
The price controls on thermal coal, used for power generation, were imposed in June when the government stepped in to help power plants cope with surging coal costs and ensure a stable energy supply.
But coal prices have fallen sharply in recent months, now below the price caps, with a decline in demand from the power sector due mainly to weaker manufacturing activities.
In the annual price discussion on this year's coal contracts which ended last Saturday, miners and China's top five national power companies failed to sign a single deal as the two sides' positions were miles apart. Coal-fired power firms, which were expected to lose 70 billion yuan (US$10.26 billion) last year, insisted term prices should fall as demand growth dropped. Coal producers demanded a rise of up to 10 percent to reflect higher tax and to make up for losses because of the state price controls.
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