Vietnam Is Considering To Open The Coal Market

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With the development of the domestic market, more and more Vietnamese coal and electric power enterprises begin to call for opening coal market to create a competitive environment. In this way, the industry vitality and energy security can be ensured.

According to the Vietnam News Agency, the Vietnamese government has designated the Ministry of Industry and Trade to make a development plan for the coal market which means the Vietnam government will gradually reduce the control of the market to increase market competition, and then ensure supply and demand balance of the domestic coal market.

It is reported that Hoang Quoc Vuong, the Vietnamese Deputy Minister of Industry and Trade, held a meeting with Vietnam National Coal and Mineral Industry Group (Vinacomin) and Dong Bac Company to discuss the specific details.

There are predictive data showing that by 2030 in Vietnam, coal demand used for electricity will reach 100 million tons per year. In order to meet the demand, Vietnam may need to import about 80 million tons of coal every year. Hoang Quoc Vuong said, since the domestic demand has showed a diversified trend, the government should develop the new market policy.

The Ministry of Industry and Trade hope to create a "competitive coal market" where price varies with the relationship between supply and demand, and they also want to actively promote the construction of the export market based on the protection of domestic coal consumption.

Vietnam News Agency said that Vietnam's coal market has been criticized because of improper management. The coal enterprises also had much to complain about. In the case of Vinacomin, as a coal production enterprise, its poor financial situation make it hope to be more flexible to make production, sales plan, and break the export quotas restrains.

It is said that, Vinacomin has not yet agreed with EVN's plant on the price used from December 26, 2016 to February 28, 2017. What’s worse, coal procurement contract of this year has not forthcoming.

Vinacomin hope that the Vietnamese government can give support to coal production enterprises. On the one hand, the government could provide more flexibility for EVN in making production and sales plan under long-term contracts, and permit the group export coal overseas that could not sale in domestic market; on the other hand, the Vietnamese Ministry of Industry and Trade should formulate policies to encourage domestic coal use, and restrict coal import.

The group suggested that the Industry and Trade should order PetroVietnam and EVN not to buy anthracite from other suppliers this year to help Vinacomin increase revenues and avoid losses.

Phuong Kim Minh, the deputy general manager of Dong Bac, put forward that Ministry of Industry and Trade should totally prohibit coal power plants cooperating with other emerging coal suppliers, so as to ensure the normal development of domestic producers. At the same time, the company also hope to be able to export coal inventory that cannot be consumed in domestic market.

Phuong Kim Minh thought that the Vietnamese Ministry of Finance should provide negotiation guidance to EVN and Vinacomin to facilitate both sides to agree on the price of coal supply as soon as possible.

It is known that Hoang Quoc Vuong has confirmed that the Vietnamese Ministry of Industry and Trade strive to balance the supply and demand when they make plan for coal market to protect national energy security better.

Vietnam Is Considering To Open The Coal Market

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