Coal prices in China have been falling in recent days after top coal producers in the country made concerted efforts to rein in rising prices ahead of the peak winter heating season, according to media reports.
Top coal suppliers in China, including Shenhua Group, China National Coal Group and Datong Coal Mine Group, have moved to lower coal prices in the spot market in the country's north by 10 yuan (.5) per ton, The Shanghai Securities News reported on Sunday.
As a result, the closely watched Bohai-rim coal price index was at 586 yuan per ton last week, the same as the previous week and ending three consecutive weeks of increases, according to the report.
The price-cutting measures by major coal producers were also accompanied by rising inventories. As of October 3, the coal inventory at Qinhuangdao in North China's Hebei Province rose to 6.74 million tons, up about 1 million tons from the level at the end of August and double the level during the same period last year, the Shanghai Securities News noted.
"The persistent rise in coal inventories has effectively addressed supply shortages and offered support for the upcoming winter heating season," the report said.
Apart from price cuts and rising inventories, the country's efforts to cut coal use in power and heat generation will also take a toll on coal prices, analysts told the Shanghai Securities News.
Faced with heavy pollution from coal burning plants in the country's northern regions during winter, the government has taken various measures to cut the use of coal, including price discounts for electricity.