China’s economic planner, the National Development and Reform Commission, says the surge in coal prices does not reflect market fundamentals. 

“The surge of coal prices does not conform with the real market fundamentals. In fact, we have received some reports about a rise in speculative trading in the coal market,” said Lu Yanchun, vice director of Price Superbision Bureau, NDRC.

The NDRC says the oversupply of coal has not eased in China and the price surge does not mean that the country’s de-capacity goal in the industry has been reached. 

The NDRC says China will continue to cut production capacity in the coal sector as it predicts that the demand for energy consumption will continue to decrease in the longer term.