BEIJING: China has increased energy production and curbed prices to ensure enough energy for factories and support the economy, allaying concerns about stagflation.
Energy prices have risen globally since the start of this year amid a shortage of supply.
In China, energy tensions caused power cuts in September, affecting families in some areas and forcing some factories to shut down production.
“China has made efforts to boost coal production and bring coal prices back to a reasonable range,” Meng Wei, spokesperson for the National Development and Reform Commission, said Tuesday in a statement. regular press conference.
China’s coal production rose 4 percent year-on-year to 360 million tonnes in October, and coal production maintains steady growth this month, according to data from the National Bureau of Statistics (NBS) .
Coal stocks at the country’s power producers rebounded, with power plants nationwide reporting a total of 129 million tonnes of coal in their stocks on November 14, enough for 22 days of consumption.
This is nine days above the level at the end of September.
Rising coal production and inventory at power plants helped push down once-skyrocketing coal prices, with coal futures on the Zhengzhou Commodity Exchange plunging nearly 60% from the market. at their peak in a month.
Besides coal, China has also increased production of natural gas to ensure adequate supplies. Since November 7, China’s daily supply of natural gas has reached more than one billion cubic meters (m3), about 100 million m3 more than the same period last year.
“Gas companies need to increase production to increase domestic supplies,” Meng said.
Soaring commodity prices once raised fears of stagflation in the world’s second-largest economy, an economic phenomenon in which prices rise while business activity stagnates.
Stagflation leads to high unemployment and reduced purchasing power of consumers. Soaring energy prices have raised companies’ production costs and heightened fears of stagflation.
There appeared to be signs of stagflation due to the pandemic, natural disasters, rising international commodity prices and tighter commodity supplies.
These were “caused by short-term factors and the situation will be temporary,” NBS spokesman Fu Linghui said.
The country’s economy has maintained a solid recovery, NBS data showed on Monday, with retail sales and factory production exceeding expectations and the unemployment rate remaining low in October.
China’s value-added industrial production rose 3.5% year-on-year in October, from 3.1% in September.
Retail sales of consumer goods rose 4.9% year-on-year last month, 0.5 percentage points higher than a month earlier.