China\u2019s benchmark thermal coal prices have jumped for 11 straight weeks, hitting the highest level in three years this week, amid lower domestic production and reduced imports from top coal exporter Indonesia.\u00a0<\/p>\n
The spot thermal coal price at Qinhuangdao, the benchmark for Chinese prices, jumped to 986 yuan, or $147 per ton for the week ending Monday, according to data compiled by Bloomberg<\/a>.<\/p>\n Coal prices in the world\u2019s biggest coal consumer, which still relies on the fuel for nearly 50% of its power generation, have rallied by 24% since the middle of July, amid tighter supply and high demand.\u00a0<\/p>\n China\u2019s spot thermal coal prices have been rising since late spring<\/a>, when the deadliest mining disaster in 16 years in May prompted authorities to step up safety checks and order suspension of activities in a number of mines in the key coal-producing region of Shanxi.\u00a0<\/p>\n Chinese authorities are not restricting coal power growth in the new five-year energy plan<\/a> as Beijing doubles down on the fossil fuel as a \u201cbottom-line guarantee\u201d of the electricity system amid rising shares of renewable power.\u00a0<\/p>\n But Chinese output has been trending lower this year from a year earlier, while Indonesia\u2019s thermal coal exports have been crimped<\/a> by government production quotas and heightened uncertainties about Indonesia\u2019s policy in the coal mining and exporting sectors.\u00a0\u00a0<\/p>\n Year to date, China\u2019s imports from Indonesia have dropped by about a fourth, compared to last year\u2019s levels, as the Indonesian government slashed quotas for coal miners and the strong El Ni\u00f1o has reduced rainfall and lowered<\/a> river water levels, disrupting coal barge movements to export ports.\u00a0<\/p>\n Amid lower domestic output and imports from Indonesia, China\u2019s government earlier this month called on local coal miners<\/a> to maintain a stable production rate after a jump in spot prices for thermal coal. Chinese authorities are pushing to boost coal production ahead of the winter season, when coal is expected to play a more prominent role in stabilizing power generation.<\/p>\n By Tsvetana Paraskova for Oilprice.com<\/a><\/p>\n