High coal prices hinder the signing of coal supply agreements

Recently, Shanxi Province began to guide the coal production, transportation, and demand convergence in 2011. The Provincial Coal Industry Department defined the legal coal production enterprises that participated in the signing of the coal source purchase and sales contract in 2011. Among them, participating in the legal production of coal source purchase and sales contracts was signed. The enterprises are: legal coal production enterprises approved by the province, infrastructures approved by the province, technical upgrading mines, and legal coal washing companies.

Song Zhichen, researcher of China Investment Advisor Energy Industry, pointed out that at the end of each year, coal production companies, coal sales companies, and consumer companies will sign an important time point for the coal supply and marketing agreement in the coming year. Although the country has already cancelled the unified coal production and transportation needs meeting across the country in 2009, in order to protect the stable supply of coal and to some extent reduce the price risk associated with rising coal prices, many coal-consuming enterprises All hope to cooperate with coal production companies by signing supply agreements. Recently, Guodian Group has held a coalition symposium on coal resources in Inner Mongolia to seek cooperation between coal-fired power companies and establish a long-term strategic partnership. This is also to protect the company's coal supply and minimize the price of coal.

The country has previously cancelled the national unified coal production, transportation and demand convergence meeting, mainly because the differences between coal production enterprises and power companies are relatively large. As a result, the outcomes of coal production, transportation, and demand convergence meetings in recent years have been minimal. Coal production enterprises The signing rate with power companies is not satisfactory either. After leaving the country to coordinate the coal-fired power companies, the purchase and sale of power coal was completely decided by the coal-fired power companies themselves. This year, due to the sharp rise in coal prices, power companies have been under greater pressure, so power companies have higher enthusiasm for signing long-term supply agreements. Some time ago there was a voice calling for a nationwide coal convergence meeting. However, the current high coal prices have become the biggest obstacle to the successful signing of supply and marketing agreements between coal companies and power companies.

Zhang Yanlin, research director of China Investment Consulting Co., Ltd., pointed out that the signing of coal supply and sales agreements between power generation companies and coal companies is mainly aimed at ensuring the stability of coal sources and minimizing coal purchase costs. However, at present, the price of coal is soaring. It is less likely that power companies will enter into supply and marketing agreements with coal producers at lower prices. The previous disagreement on coal prices is that it is difficult to reach a consensus between power generation companies and coal companies. The main reason. At present, for power companies, it is more effective to join forces with coal companies than to go it alone.

The “2010-2015 China Coal Industry Investment Analysis and Prospect Forecast Report” issued by China Investment Advisors pointed out that for thermal power generation companies, how to reduce fuel costs has become the key to business operations. The establishment of a long-term cooperative relationship with coal companies and the signing of medium and long-term cooperation agreements to reduce business risks are the direction that power generation companies are actively exploring.