The deadline for the collection of contracts for coal production and transportation is only the last 7 days, but the total connection is only completed 1/5, and the key contract for coal is once again stuck.
According to the data of China Coal Transportation and Marketing Association, as of 12 noon on December 23, the coal supply and transportation demand contract in 2011 was initially aggregated by 199.8 million tons, which is less than 22% of the 2011 national inter-provincial coal total capacity required by the National Development and Reform Commission.
The price has become an important obstacle affecting the progress of negotiations between the two sides. A coal industry person involved in the negotiation of key coal contracts said: "As long as the price is negotiable, the contract will not be 'difficult to produce'."
However, for power companies, the “limit price order†of the National Development and Reform Commission is their shield. The power companies interviewed by this newspaper all indicated that they would sign an agreement with the coal enterprises according to the price set by the National Development and Reform Commission.
In view of the slow progress of the contract summary work, the China Coal Transportation and Marketing Association recently issued the “Notice on Accelerating the Linkage of Coal Production and Demand in 2011 to Do the Online Consolidation of Contractsâ€, requiring all departments to “sign the annual contract strictly in accordance with the requirements to ensure the production of coal. The work needs to be completed as scheduled."
Slow progress
On December 6, the National Development and Reform Commission issued the Notice of the National Development and Reform Commission on Doing a Good Job in the Coordination of Coal Production and Transportation in 2011 (hereinafter referred to as the “Noticeâ€). The deadline for the contract is December 31, leaving 25 days. Negotiating and signing contracts for coal-fired power companies is similar to the situation in previous years.
The "Notice" requires that if the contract is not completed and entered into the network system within the specified time, the capacity will no longer be implemented. Capacity is an important guarantee for the implementation of coal trading contracts. In the current situation of bottlenecks in coal transportation, the connection between production and transportation is often referred to as the capacity allocation meeting. Capacity allocation has become an important means for the National Development and Reform Commission to promote coal-fired power enterprises to speed up contract signing.
In 2011, the total coal transportation volume across the provinces was 932 million tons, of which 769 million tons were key coal. According to the current signed 199.8 million tons, it is less than 22% of the total traffic. In other words, for the remaining week, both coal and electricity companies need to sign more than 700 million tons of contracts.
In this regard, Wu Chenghou, vice chairman of the China Coal Transportation and Marketing Association, believes that the signing of a large number of contracts in the last few days is a very normal phenomenon and there is nothing special about it. The main reason is that local governments should balance the supply of coal inside and outside the province.
Zheng Yong, secretary-general of the East China Coal Sales Consortium, said that although most of the contracts have not yet been signed, most of the parties have already approached the contract and are waiting for the approval of the company leaders.
However, in the eyes of power companies, the situation is not the same. Asked about the negotiation of key coal contracts next year, Huaneng Group said: "It is not ideal, and there are not many signed." Zhang Shengji, deputy director of the Fuel Management Department of Guodian Group, also told this newspaper that Guodian Group has not yet signed.
Price dispute
The slow progress of the signing of the contract between the coal and electricity companies was unexpected in the market, because the coal-electricity disputes in previous years were often due to the inability to negotiate the key contract coal prices, resulting in the contract being “difficult to produceâ€, and this year the situation was different. The NDRC requested 2011 in the Notice. The annual key thermal coal contract price will remain unchanged in the previous year and shall not be changed in any form in disguise.
Power companies believe that the contract price will be signed according to the requirements of the National Development and Reform Commission, while coal companies have their own calculations. A coal industry official involved in the negotiation of key coal contracts said, “As long as the price is negotiable, the contract will not be “difficult to produceâ€.â€
Our reporter learned that the key coal contract is usually only signed, and the price is determined by a later supplementary agreement. Such price increases have circumvented the policy risks of coal companies and ensured capacity. Moreover, coal pricing has many other forms, making it even more difficult to control coal price increases.
"The central problem of the contract is quantity and price. It is impossible to leave the price to talk about the contract." The above-mentioned person said that "as long as both parties accept it, it is a reasonable price. The price is unreasonable, the coal that the power plant can get is insufficient, and the quality is also not good."
A senior executive of the five major power companies said in an exclusive interview with the newspaper that the market coal price reform and reform committee could not manage it, but they could not control the key contract coal prices. He said that coal enterprises will adopt various means under the drive of interests: the first does not guarantee supply, the price is controlled, the quantity will definitely come down; the second is to reduce the quality of coal, which is actually equal to the price increase in disguise.
“The contract seems to be a form. Coal companies often do not execute contracts. Even if the price is signed, the price will increase during the execution of the contract.†An industry expert said: “Although it is only a form, it can at least guarantee capacity, and even the key coal. The price increase will not rise to the extent of market coal."
It is understood that the key contract coal accounts for about 42% of the total coal consumption of the power plant. Therefore, even if the key contract coal price is not managed, the cost reduction for thermal power enterprises is only a drop in the bucket.
Non-key coal
The key coal is composed of the nationally approved coal-fired factory guide price, freight and handling charges, and the price is relatively stable. It has always been a certain gap from the market coal price, and it still differs by more than 150 yuan/ton. Coal companies have always believed that the price double-track system should be abolished or the price should be approached year by year.
The power companies believe that the key contracts are similar to the long-term users, and the price should have a discount.
According to this newspaper, coal companies will also give certain discounts when signing contracts with major customers, but their prices will be closer to market coal prices. Therefore, the coal industry regards key coal as a product of the planned economy, which not only succumbs to the direction of market-oriented reform, but also affects corporate profits.
"The market has been released, and what is the 'focus'? It is just the wording imposed on the market," said the coal industry.
The National Development and Reform Commission has stricter control over key contract coal. In April this year, due to the increase in market coal prices, some coal companies raised the contract price of key coal that had already been signed. However, by June, this behavior was stopped by the National Development and Reform Commission, and the coal enterprises were required to return the profit from the increase in the price of key coal. .
The above-mentioned five major power executives pointed out that the root cause of the contradiction between coal and electricity lies in the fact that the reform of the two industries is not synchronized. It is impossible to solve the problem by relying on the tangible hand of the government. Instead, it should speed up the reform of the power system and give full play to the role of the market in allocating resources. Solve these problems systematically.
According to the data of China Coal Transportation and Marketing Association, as of 12 noon on December 23, the coal supply and transportation demand contract in 2011 was initially aggregated by 199.8 million tons, which is less than 22% of the 2011 national inter-provincial coal total capacity required by the National Development and Reform Commission.
The price has become an important obstacle affecting the progress of negotiations between the two sides. A coal industry person involved in the negotiation of key coal contracts said: "As long as the price is negotiable, the contract will not be 'difficult to produce'."
However, for power companies, the “limit price order†of the National Development and Reform Commission is their shield. The power companies interviewed by this newspaper all indicated that they would sign an agreement with the coal enterprises according to the price set by the National Development and Reform Commission.
In view of the slow progress of the contract summary work, the China Coal Transportation and Marketing Association recently issued the “Notice on Accelerating the Linkage of Coal Production and Demand in 2011 to Do the Online Consolidation of Contractsâ€, requiring all departments to “sign the annual contract strictly in accordance with the requirements to ensure the production of coal. The work needs to be completed as scheduled."
Slow progress
On December 6, the National Development and Reform Commission issued the Notice of the National Development and Reform Commission on Doing a Good Job in the Coordination of Coal Production and Transportation in 2011 (hereinafter referred to as the “Noticeâ€). The deadline for the contract is December 31, leaving 25 days. Negotiating and signing contracts for coal-fired power companies is similar to the situation in previous years.
The "Notice" requires that if the contract is not completed and entered into the network system within the specified time, the capacity will no longer be implemented. Capacity is an important guarantee for the implementation of coal trading contracts. In the current situation of bottlenecks in coal transportation, the connection between production and transportation is often referred to as the capacity allocation meeting. Capacity allocation has become an important means for the National Development and Reform Commission to promote coal-fired power enterprises to speed up contract signing.
In 2011, the total coal transportation volume across the provinces was 932 million tons, of which 769 million tons were key coal. According to the current signed 199.8 million tons, it is less than 22% of the total traffic. In other words, for the remaining week, both coal and electricity companies need to sign more than 700 million tons of contracts.
In this regard, Wu Chenghou, vice chairman of the China Coal Transportation and Marketing Association, believes that the signing of a large number of contracts in the last few days is a very normal phenomenon and there is nothing special about it. The main reason is that local governments should balance the supply of coal inside and outside the province.
Zheng Yong, secretary-general of the East China Coal Sales Consortium, said that although most of the contracts have not yet been signed, most of the parties have already approached the contract and are waiting for the approval of the company leaders.
However, in the eyes of power companies, the situation is not the same. Asked about the negotiation of key coal contracts next year, Huaneng Group said: "It is not ideal, and there are not many signed." Zhang Shengji, deputy director of the Fuel Management Department of Guodian Group, also told this newspaper that Guodian Group has not yet signed.
Price dispute
The slow progress of the signing of the contract between the coal and electricity companies was unexpected in the market, because the coal-electricity disputes in previous years were often due to the inability to negotiate the key contract coal prices, resulting in the contract being “difficult to produceâ€, and this year the situation was different. The NDRC requested 2011 in the Notice. The annual key thermal coal contract price will remain unchanged in the previous year and shall not be changed in any form in disguise.
Power companies believe that the contract price will be signed according to the requirements of the National Development and Reform Commission, while coal companies have their own calculations. A coal industry official involved in the negotiation of key coal contracts said, “As long as the price is negotiable, the contract will not be “difficult to produceâ€.â€
Our reporter learned that the key coal contract is usually only signed, and the price is determined by a later supplementary agreement. Such price increases have circumvented the policy risks of coal companies and ensured capacity. Moreover, coal pricing has many other forms, making it even more difficult to control coal price increases.
"The central problem of the contract is quantity and price. It is impossible to leave the price to talk about the contract." The above-mentioned person said that "as long as both parties accept it, it is a reasonable price. The price is unreasonable, the coal that the power plant can get is insufficient, and the quality is also not good."
A senior executive of the five major power companies said in an exclusive interview with the newspaper that the market coal price reform and reform committee could not manage it, but they could not control the key contract coal prices. He said that coal enterprises will adopt various means under the drive of interests: the first does not guarantee supply, the price is controlled, the quantity will definitely come down; the second is to reduce the quality of coal, which is actually equal to the price increase in disguise.
“The contract seems to be a form. Coal companies often do not execute contracts. Even if the price is signed, the price will increase during the execution of the contract.†An industry expert said: “Although it is only a form, it can at least guarantee capacity, and even the key coal. The price increase will not rise to the extent of market coal."
It is understood that the key contract coal accounts for about 42% of the total coal consumption of the power plant. Therefore, even if the key contract coal price is not managed, the cost reduction for thermal power enterprises is only a drop in the bucket.
Non-key coal
The key coal is composed of the nationally approved coal-fired factory guide price, freight and handling charges, and the price is relatively stable. It has always been a certain gap from the market coal price, and it still differs by more than 150 yuan/ton. Coal companies have always believed that the price double-track system should be abolished or the price should be approached year by year.
The power companies believe that the key contracts are similar to the long-term users, and the price should have a discount.
According to this newspaper, coal companies will also give certain discounts when signing contracts with major customers, but their prices will be closer to market coal prices. Therefore, the coal industry regards key coal as a product of the planned economy, which not only succumbs to the direction of market-oriented reform, but also affects corporate profits.
"The market has been released, and what is the 'focus'? It is just the wording imposed on the market," said the coal industry.
The National Development and Reform Commission has stricter control over key contract coal. In April this year, due to the increase in market coal prices, some coal companies raised the contract price of key coal that had already been signed. However, by June, this behavior was stopped by the National Development and Reform Commission, and the coal enterprises were required to return the profit from the increase in the price of key coal. .
The above-mentioned five major power executives pointed out that the root cause of the contradiction between coal and electricity lies in the fact that the reform of the two industries is not synchronized. It is impossible to solve the problem by relying on the tangible hand of the government. Instead, it should speed up the reform of the power system and give full play to the role of the market in allocating resources. Solve these problems systematically.
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