Generators brace for record coal prices

Chinese power producers are expecting to pay record prices for coal in 2005 with the expanding economy continuing to increase demand for fuel, company executives told state media. Prices are expected to rise by up to 10% from 2004 levels, driven by soaring consumption and a shortage of freight transport to move the coal from pits to the power stations, Fan Weitang, president of the China National Coal Association, said. According to forecasts China's coal demand will rise 7.4% in 2005 to 2.04bn tons, exceeding the nation's total supply of less than 2bn tons. Coal supplies 67% of China's power needs and is expected to remain the dominant fuel for the country's economy for at least the next two decades.