Government Intervention Causes China's Thermal Coal Futures Fall
In Wednesday’s morning trading, China’s most active thermal coal futures prices fell more than 4 percent.It has been the biggest one-day drop since November 2016, following news of government intervention to cool the red-hot market. Thermal coal futures fell to $92.37 per tonne by 0250 GMT and a more than 3 percent fall in the overnight trading session as investors rushed to close out long positions and pile on short bets. In the government’s first direct intervention since mid-2016, China’s state planners had ordered utilities to stop stockpiling thermal coal. They also asked miners to slash prices, this week. National Development and Reform Commission (NDRC) also told the utilities to halt buying in the next two to three weeks or reduce inventories. Some traders are tensed as they believe that the direct intervention can cause problems further out as summer approaches in China and power consumption rises.
Tags : INTERNATIONAL