going down......., page-16

re: china reducing coal exports China reducing output from small mines to improve safety [ finally doing something about the 20,000+ deaths per year ] and large mines are taking time to expand output.
Thermal coal has risen to US$50, but China can resume exports any time, so price cannot be depended on. here is article:
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Asia: Chinese Record-high coal prices spur imports

Domestic spot thermal coal prices rallied to a record high this week as small mines shut down and power plants restocked supplies, threatening to scupper Japanese utilities' hopes for sharply lower annual price deals.
The benchmark Qinhuangdao Datong has traded at 465 yuan (US$58) a ton, the highest ever, a price that will encourage more producers to sell supplies domestically this year, curbing exports from the world's biggest coal producer and consumer.

The premiums on Chinese coal prices against the world's benchmark Australian prices may also drive some southern power plants to import more supplies from Vietnam or Indonesia, analysts said.

"Demand is still very strong. And... China is shutting small mines, which has an impact on coal supply," said Zhang Feng, analyst at JP Morgan Securities (Asia Pacific) Ltd.

"For the next two to three years, China's coal prices should remain strong. China's net export of coal should fall dramatically," Zhang said, adding China's net exports could to drop by 15 percent this year and another 15 percent in 2007.

The steady decline in China's net coal exports comes as the government's drive to encourage more use of natural gas falters, leaving power plants to rely heavily on the dirty fuel that already generates about three-quarters of their electricity.

Coal output will rise 5 to 6 percent to 2.2 billion tons this year, while demand would grow by 150 million tons to 2.15 billion tons, the National Development and Reform Commission's price monitoring center said this week.

Official data showed China's 2005 coal exports fell by 17.2 precent to 71.72 million tons, while imports jumped 40 percent to 26.17 million tons.

Analysts said it would take time for big mines such as Shenhua Energy Co. Ltd. to expand, especially as the government is introducing stricter rules on environment, safety and resources. They estimated small mines accounted for about 40 percent of the country's annual output.

Analysts said the strong demand from China, coupled with a cold winter in Japan and South Korea, had already jacked up spot coal prices from Australia to US$47 to US$48 a ton, free on board, recovering sharply from lows of US$37 to US$38 in December.