By Muyu Jiu and Chen Aizhu

BEIJING/SINGAPORE – Chinese coal traders claim they are trying to find spot price information for spot transactions. They rely on personal communication as Beijing intensifies its scrutiny of the market amid attempts to control prices.

The country’s top economic planner, the National Development & Reform Commission said this week it would investigate coal and energy index providers over spreading “fabricated” price information. It is currently studying new mechanisms to keep coal prices in a sustainable range for the long-term.

This increased scrutiny puts strains on the Chinese coal trading industry, already having to cope with the rapid regulatory and market changes. China is the largest coal buyer in the world. In China, the worst ever power crisis has been compounded by the pricing chaos. Beijing is trying to recover from this pandemic.

Beijing unleashed an array of measures in September. These range from ordering miners to boost production immediately to liberalizing thermal power prices.

Because they can be confusing, we stopped reading the domestic indexes. “We now call other traders to obtain daily prices,” stated a Guangxi-based trader in coal. He, like many others who were interviewed, declined to name the person because the subject is sensitive.

China tightened its rules regarding commodity index providers in June to curb the soaring prices of commodities ranging from iron ore to copper. The recent move on coal intelligence providers was spurred by stubbornly high prices of the key electricity-generating fuel.

Last Wednesday’s Benchmark Zhenzhou thermal coal futures fell 10% to 1,144 yuan at 0700GMT. It was the sixth consecutive day in declines after Beijing’s cooling steps. However, the price is still higher than it was last year.

(For graphic on China spot and futures coal prices – https://fingfx.thomsonreuters.com/gfx/ce/myvmngrgapr/Pasted%20image%201635302435018.png)

Once upon a time, data such as the coal consumption of major power stations and stocks at key ports were available online. This information was also shared on social media.

Traders said that traders have reported that the information had been kept private behind paywalls over months.

Analysts and traders have instead relied on their personal communications or used international prices to gauge.

An analyst based in Beijing said that the prices of Indonesia are being used, along with shipping and other costs to figure out delivered prices for power plants.

Spot coal transactions data are still updated by certain providers, although the numbers haven’t changed much from months back.

An expert coal trader based in Beijing said, “Some pricing indicators still provide daily assessments but at prices that are very far from real transactions.” “It is difficult to quote reliable price indexes right now.

China Coal Transportation and Distribution Association (which represents sellers and shippers of coal) posted its reference prices of spot Bohai Rim thermo coal on Wednesday. It is unchanged since mid August.

Consulting Fenwei Digital Information Technology also displayed some unchanged coal prices as of Wednesday, at approximately 1,000 yuan per ton since July.

According to traders, Reuters reported that deals last week were struck at Bohai Rim, the central spot trading area, for more than 2,000 yuan. The southern port of Guangdong was also sold at nearly 2,500 yuan.

China Coal Transport and Distribution Association representative said that it updates prices regularly and declines to comment. Fenwei refused to comment.

The NDRC didn’t immediately reply to our requests for comment.

Chinese data suppliers have been slowing down since June when Beijing introduced new rules that require them to set prices more transparently and consistently.

Yulin Coal Trading Centre Corp was banned by the government from publishing price assessment and market news.

We stopped publishing prices domestically for several months. The situation is extremely sensitive,” said a Beijing-based manager at a commodity price assessment agency.

($1 = 0.1566 renminbi)