Succumbing to the mounting pressure of rising coal prices, the Chinese government has recently decided to relax its coal production restriction, albeit with some mandates.
It is learnt that the National Development and Reform Commission (NDRC) of China has decided to allow coal companies in that country to increase coal production as coal prices have been rising heavily in the global markets, mainly to due higher Chinese consumption.
Coal imports into China have increased substantially after May 2016, when that government had imposed a 276 working-day-per-year rule for the coal miners, from the erstwhile 330 working days per year, in the effort to trim coal production in the country, aimed at curbing over-supply.
According to the relaxed norm, the major coal miners in China will be able to ramp up production in between Sep’16 and Dec’16.
But, will the relaxed coal production norm help in soothing the upswings in global coal prices? Only time will tell.
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