China’s Benchmark Qinhuangdao Coal Prices Fall 30% in a Month

By Wang Ying

Nov. 26 (Bloomberg) -- China’s coal prices at Qinhuangdao, a domestic benchmark, fell by 30 percent in a month because of weaker demand for the fuel.

The price for the top grade of power-station coal has declined to 680 yuan ($99.60) a metric ton as of Nov. 24, from 970 yuan a ton as of Oct. 27, according to the China Coal Transport and Distribution Association.

Coking and thermal coal demand growth in China may slow to 5 percent next year as steel producers cut output and electricity consumption eases because of the economic slowdown, David Fang, a director of the distribution group, said last month. Power station coal prices at Australia’s Newcastle port, a benchmark for Asia, slumped 12 percent to a 10-month low in the week ended Nov. 21, according to the globalCOAL NEWC Index.

China’s power production fell 4 percent in October, the first decline since March 2005, as a slowdown in the world’s fourth-biggest economy cut demand, the National Bureau of Statistics said Nov. 13.

The nation’s power consumption growth may slow to between 4 and 8 percent in 2009 as the economy cools, Shan Baoguo, head of research at China State Grid Corp.’s Beijing unit, said Nov. 4. The country relies on coal for almost 80 percent of its electricity generation.

To contact the reporter on this story: Wang Ying in Beijing at wang30@bloomberg.net;