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Monday, 10 August 09
VINACOMIN TO SELL COAL AT MARKET PRICES TO DOMESTIC USERS


VNBusinessNews.com - Reuters reported that Vietnamese government has agreed to let coal monopoly Vinacomin sell coal at market oriented prices to domestic users from the fourth quarter of 2009, effectively ending its subsidy on the fuel.

As per report, the government had authorized Vinacomin to sell coal to domestic users on a negotiable and market oriented basis. However, prices should still be about 5% to 10% lower than export prices.

At present domestic power plants buy coal from Vinacomin at about USD 26 to USD 27 a tonne or 70% of the miner's production cost and about half of July's average export price of about USD 54 a tonne.

Ministry of industry & trade said that domestic coal consumption in the first seven months totaled 11.2 million tonnes, up by 1.8% YoY, with purchases by power plants, the biggest coal users, dropping 7% to 3.64 million tonnes.

Vietnam is a key coal supplier to China and Japan. Total exports in the January to July 2009 period fell by 2.8% YoY to 14.2 million tonnes as it moved to save more of the fuel for domestic consumption.
Source: VN Business News



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