China's thermal coal prices surged to fresh record highs Wednesday as recent floods in a key coal producing province worsened a supply crunch, just as new efforts by Beijing to liberalize power prices boosted demand from power generators.
China, the world's largest coal consumer, has been grappling with a growing energy crisis brought on by shortages and record high prices for the fuel. The government has taken a range of steps to boost coal production and manage electricity demand at industrial plants, while power producers and other coal users have been ramping up imports.
Local governments in Shanxi and Inner Mongolia, top Chinese coal producing areas, have ordered some 200 mines to boost output, but incessant rain has flooded 60 mines in Shanxi. Four mines with a combined annual output capacity of 4.8 million metric tons remain shut, a Shanxi official told a press conference Tuesday.