Coal companies challenge the dual-track system: signing a planned coal contract to tying market coal

After conducting the online contract summary for two consecutive years, the on-site coal contract summary meeting was reopened in Kunming from December 26 to 30, 2011. Liu Jun, a coal trader who went to the meeting, told the “Financial State Weekly” reporter that this year’s contract summary meeting has not seen the unprecedented grand event in history.

According to insiders, Zhongneng Electric Fuel Company, the lead unit of the power generation industry, did not send staff to participate in the meeting and only held an internal meeting with representatives of some power generation companies in Beijing.

Prior to this round of negotiations, the large-scale and high-frequency cry of the power generation enterprises forced the NDRC to raise the price of electricity by the end of the year, increase the 5% of the key contract coal coal commonly known as “planned coal,” and make a decision to impose a ceiling price on “market coal”. It was "guessed" by the industry.

After coal price double limits, coal companies also have new tricks. “Financial National Weekly” reporter learned that the signing of “planned coal” and an alternative “long coalition” contract for tying up “market coal” in proportion has begun to appear. This does not violate the NDRC's requirements. Only within the existing policy framework, coal companies have begun to challenge the "dual-track system" of "planned coal" and "market coal."

Although evading review is no longer the same as in previous years, the Kunming negotiations still attracted many energy industry participants. Regarding the implementation of key contract coal, a participant who went to Kunming told the “Financial State Weekly” reporter that coal companies have reached a tacit understanding: When faced with the media, they all said that they will firmly implement the NDRC’s order, and the increase is not excessive. 5%.

A person from a coal-fired power plant in Shanxi Province who recently participated in the 2012 Shanxi Coal Coal Ordering Association revealed that the prices of major coal contracts signed by the five major power generation groups rose by 25 yuan year-on-year, “up from 535 yuan/ton, with an increase of 4.9. On the surface, the price is in full compliance with the NDRC's limit order; however, the contract calorific value has been reduced by 300 kcals from the previous year. In light of this, the price of key coal-fired coal contracts has actually risen by RMB 55/ton, which has exceeded the increase. 10%."

Many of the contracts are "quantity is priceless": do not write prices, and finally indicate "see details of the supplementary agreement"; can also be written in the contract text "temporary tentative price", or marked "can be adjusted for market reasons."

In a sense, "these are just a capacity contract." At the closing time of the stipulated time of 24 o'clock on December 29th, 2011, an executive from the five largest power generation groups disclosed to the reporter of the “Financial State Weekly” that “the final price of many contracts has not yet been finalized”.

“The coal mines evading contract review are just technical issues.” The power generation group executives mocked themselves.

According to sources from other domestic media, as of January 4, 2012, the contract coal network consolidation in 2012 has been completed. According to preliminary statistics, the aggregate amount of key contracts in 2012 was about 1.2 billion tons, which was overbooked by 44% compared with the frame amount of 834.6 million tons issued by the Development and Reform Commission.

Xing Lei, an associate professor at the Central University of Finance and Economics Coal Research Center, told the “Financial National Weekly” reporter that in 2011, the total amount was 1.1 billion tons, which exceeded the framework of 931 million tons. “The final redemption rate is estimated to be less than half.”

However, “Financial National Weekly” reporter also learned that in recent years, the National Development and Reform Commission has increasingly strict requirements on the review of coal contracts and contract redemption rates, and there has been priceless or redemption of the amount, and many coal companies have begun to be taboo. “The rate of fulfillment of key contracts has become a target for publicity.” A senior manager of the Shanxi Provincial Coal Sales Group said, “The company pays great attention to the cash rate of key coal contracts. The relevant departments will regularly investigate the implementation of coal companies. If there are any oversights, they will inevitably double. Penalty.” It is reported that Shanxi Coking Coal Group and Yangmei Coal Group have all received large penalties.

The dual-track coal price is derived from the "partial marketization reform" of coal prices conducted in 1993. At that time, in order to ensure the stability of electricity prices, the state set the price of thermal coal for state-owned large-scale power plants, thus forming a dual-track system of “planned coal” and “market coal” coexisting.

In the original design, it was hoped that coal supply would be guaranteed through "planned coal"; market coal would serve as a path to market-oriented reform of the coal industry.

However, some experts believe that it is precisely because of the "dual-track system" of coal prices that coal-power contradictions have been caused for many years. The nature of capital's profit-seeking nature determines that thermal power companies want to have more low-priced “planned coal”, while coal companies hope to sell more high-priced “market coal”.

Once the "planned coal" price was also higher than "market coal," large-scale coal enterprises did not care about the products, small coal mine business is hot. During the Asian financial crisis in 1998, China’s state-owned coal industry suffered a total loss. When “planned coal” prices were lower than “market coal,” large coal companies sold a large number of products to the market, and were not willing to supply them at planned prices. Or "stealing work cuts."

At present, the transaction volume of coal-fired key-order contracts accounts for about 60% of the total coal consumption. There is currently a spread of several hundred yuan between the plan and the market; the balance is gradually tilting toward coal companies with “resources as king”. According to an interview with the “Financial National Weekly” reporter, more and more coal companies started to adopt the “planned coal tying market coal” approach this year.

It is understood that the Shanxi Coal Group's coal contract this year resembles that of previous years, "version", variety, quantity remained unchanged, but there is one more requirement: the focus of contract coal to determine the price in accordance with the 5% increase, while the market trading coal by 10% The price increase determines the price, and finally the two are tied together to sign the contract at a ratio of 1:3. Henan Pingmei Shenma Group also adopted this strategy: In 2012, the key contract coal price rose from 486 yuan/ton to 511 yuan/ton, a rise of 5%; but a higher percentage of the transaction contract price was from 536 yuan. / Ton rose to 589 yuan / ton, an increase of 10%.

Coal companies also lose money?

An industry source stated that the bundling of dual-track coal is indeed a relatively common practice among coal companies. The reason is that, in doing so, one can evade the risk of violating the NDRC's policies; the second is to ensure the company's own profits and sales.

“Planning coal to market coal seems to meet the common requirements of the two industries.” said a senior expert in the coal industry.

The expert said that after the thermal power plant suffered losses due to "planned electricity" and "market coal" problems in 2011, "coal enterprises also began to scream for losses. Some coal companies said that the increase in coal prices for key contracts will increase by 5%, resulting in the sale of a ton of coal loss of one ton. , people will doubt the letter."

The statement that “coal companies are also losing money” has also been heard by reporters from the “Financial National Weekly”. A related person in charge of the Hebei Kailuan Mining Group stated that "the cost of a hundred-year-old mining is very high." Now a ton of coal loss is about 45 yuan. If the NDRC stipulates an increase of 5%, it can only rise about 15 yuan/ton. "The loss of 30 yuan/ton is difficult to make up for."

In an interview, Wang Zhenyu, chairman of the Anhui Coal Economic Research Association, explained that Anhui Province has been included in the national key coal supply in the four major coal enterprises in Huaibei, Huainan, Yubei, and Xinji. In recent years, there have been electricity supply prices that are lower than the company's tons. The phenomenon of coal costs. "If you calculate the 44.95 million tons of electricity coal that were issued to four companies by the state in 2011, the losses of the four companies this year will reach 2.24 billion yuan."

Concerning the question of “coal prices have brought coal profits”, an executive from a coal company in Shanxi Province told the “Financial National Weekly” reporter that “coal prices have increased, but coal mining costs and related costs have grown faster”.

An executive from Shanxi Tongmei stated that the industry's estimated resource tax pilot for 2012 will be expanded and that the local government's expropriation of coal price adjustments is also increasing, which will further increase the cost of coal; Tight, it will also further increase the cost.

According to relevant statistics, various taxes and fees of Shanxi coal enterprises have already accounted for more than 30% of sales revenue.

The relevant person in charge of Hebei Kaiyuan stated that “coal companies really need to reduce their burden; especially state-owned enterprises, the social burden is very heavy”.

On the afternoon of January 11, 2012, the latest issue of the Bohai Bay thermal coal price index fell for nine consecutive weeks. The Bohai Bohai Thermal Coal Price Index released by the China Shipping Coal Network Index Center showed that the comprehensive average price of 5,500 kcal thermal coal for the current period is RMB792/ton was a decrease of RMB 5/ton from the previous week, a decrease of 0.63%, which was basically the same as the level of the same period of last year and a slight increase of 2%.

Li Xuegang, an expert in the coal industry, pointed out that the recent drop in thermal coal prices in the Bohai Rim market has exceeded the expectations of most coal production, shipping, consumer, and trading companies.

Some industry experts believe that due to the impact of the European debt crisis, coal prices in China may continue to weaken in 2012.

The temptation of marketization In the "contract coal" to make money or "loss", coal companies will hope more and more pinned on the "market coal" body.

“The tying of a certain amount of profitable market coal to key contract coal will not only benefit the stable supply of energy, but also benefit the sound development of the coal-fired power industry,” said one person from a coal enterprise.

In the long run, the marketization of coal will be the final goal. This allows coal companies to have a calm attitude toward the practice of “bundling sales” under the dual-track coal price. This form can also be understood as an “extraordinary long association”. .

At the 2012 coal summary meeting, Liang Dunshi, deputy secretary-general of the China Coal Transportation and Marketing Association and spokesperson of the press, said that in view of the coal ordering situation over the past few years, “it has increasingly shifted to the direction of coal market transaction construction and coal marketization.”

A survey of China Coal Trading Center shows that coal is difficult to standardize, the bottleneck of railway transport capacity and the complexity of the purchase and sales model, which seriously restricts the marketization of coal in China.

During the interview, some people in the industry pointed out that under the “GDP cult,” local governments are currently struggling to speed up the development of coal resources, violate national laws and regulations, and eliminate the need for market competition to allocate coal resources. This has led to difficulties in the market-oriented reform of coal resources allocation.

At the same time, some local governments directly intervene in the use of coal. Recently, individual provinces in the west have restricted the province's coal from exiting; local governments, in order to support local high-energy-consuming enterprises, will inevitably give rise to preferential tariffs for electricity while they will correspondingly prevent local coal prices from rising and stop the market price of coal products.

Zhou Dadi, deputy director of the China Energy Research Association and energy expert, believes that China's control of energy prices is to encourage high energy consumption to some extent.

For coal companies wanting to combine the two-track coal price approach, senior coal expert Li Chaolin said that the dual-track coal price system has always been a confused account, and it is difficult to say who is right or wrong.

Li Chaolin told the "Financial National Weekly" reporter that although the country has repeatedly proposed the coal industry to "go to the market" since 1993, it has specified the magnitude of changes in the price of electric coal at several national coal ordering conferences since 2002; During the "Five" period, coal prices were frequently intervened, peak summers were received every year, and the price of coal was not allowed to increase in all regions.

Fan Bi, the deputy director general of the Research Department of the State Council Research Office, told the “Financial State Weekly” reporter that “the coal-power conflict seems to be a game between coal companies and power companies. It actually involves four aspects of coal, electricity, transportation and government. Systematic issues."

Fan Bi believes that the coal price signal under dual-track operation is in a distorted state; in the face of a market with a distorted price signal, the National Development and Reform Commission hopes to open up the coal price, but in view of energy security, it has to intervene in the end.

Fan Bi believes that coal and electricity linkages should not be a permanent solution. "The reform of electric power should be restarted and it should be put on the agenda."

On January 10, 2012, the State Electricity Regulatory Commission, Wu Xinxiong, stated at the annual work conference that it will put forward a road map for deepening the reform of the power system in the “Twelfth Five-Year Plan” to resolve the contradiction between coal and electricity, and explore the mechanism for promoting electricity price formation. reform.

The reporter of the "Financial National Weekly" learned that the relevant departments are drafting the "Opinions on Promoting the Healthy Development of Coal Trading Centers" to explore ideas and plans for accelerating the construction of the coal market system.