Reporter observation: coal price interval regulation mechanism to power coal futures trading what impact?

2022-05-11 0 By

Beijing, February 25 (reporter Lu Hongqiao) According to the China Media Group economic voice “World Finance and Economics” reported that the National Development and Reform Commission (NDRC) has further improved the coal market price formation mechanism, put forward a reasonable range of coal prices, and established a price range regulation mechanism.One focus is how futures markets will integrate with the new pricing mechanism.So, thermal coal futures trading will be affected?Is there a price range?Thermal coal futures prices fell sharply after the National Development and Reform Commission issued a reasonable range for coal prices.The main contract fell more than 9 per cent to 745 yuan a tonne.In recent days, thermal coal futures prices have fluctuated between 660 yuan and 900 yuan, well below their levels in September and October last year.A futures company of a customer manager told reporters that this is mainly because the exchange has adjusted the trading mechanism.”There is speculation, but if you want to go back and forth day to day and make profits, it’s a bit more difficult because it’s restricted trading,” said the client manager.Many of the previous day short line, thermal coal a day to open, close the warehouse back and forth hundreds of times, now limited, there is no way to switch to other varieties.Since last year, the Zhengzhou Commodity Exchange has adjusted its thermal coal futures trading mechanism several times.On February 21, the maximum order quantity of the limit order was adjusted to 50 lots.So, in the future, whether the thermal coal futures price fluctuation will further narrow, can only be in the medium and long term contract coal price reasonable range, namely between 570 yuan -770 yuan fluctuation?A staff member of The Zhengzhou Commodity Exchange responded: “We have not received any notice at present. If there is any notice, we will immediately announce it on the website. There is no change at present.We can only do a good job in market supervision, that is to say, there are no violations of laws and regulations.”In fact, the reasonable range of coal prices proposed by the National Development and Reform Commission this time is for medium – and long-term contracts of coal, for the use of other ways of trading coal, there is no clear price range.However, the National Development and Reform Commission said that coal spot prices can not significantly deviate from the reasonable range of mid – and long-term trading prices, found significant deviation, will promptly cooperate with relevant departments to take comprehensive measures to strengthen the linkage supervision of the spot market.In other words, the National Development and Reform Commission and other departments do not directly set the price range for the futures market, but will intervene in a timely manner.The industry believes this is in line with financial and economic rules.”After all, the futures market is set by people. It doesn’t mean that people will buy at the price you set,” said the client manager.Everyone will buy if it is expected to rise, then the price will be high, and the country will control it again.Thermal coal used to go up very high, and then a series of limit fell down.”So what will happen to the thermal coal futures market next?The amount of interest in the main contract is just over 10,000 lots, compared with hundreds of thousands in the past, suggesting that the coal futures market has cooled considerably.Chen Xin, a researcher at Cinda Securities, said: “I don’t think it will have a big impact in the short term.If energy use is large, coal use is also large, natural thermal coal has to rise, how much can rise depends on the tolerance of the National Development and Reform Commission.”Industry insiders believe that with the establishment of mid – and long-term contract coal price range control mechanism, coal futures prices will remain stable.Zhang Hong, a spokesman for the China Coal Association, said: “Futures are actually physical and there is very little coal futures market in China.Now medium and long term contracts account for about 80%, medium and long term contracts because of the high proportion of thermal coal, so as long as the price of medium and long term contracts is stable, then the whole spot market can also play a stable role.”