Top Chinese Economic Planners Discuss Imposing Price Caps For Coking Coal, Steel - Bloomberg

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July 25 (Bloomberg) -- China's National Development and Reform Commission, the country's top planner, held a meeting to discuss imposing price caps on steel, coking coal and coke to help manufacturers cope with rising costs, two officials said.

China Iron and Steel Association, China Coking Industry Association, producers and manufacturers met Wednesday in Beijing, the industry officials said, declining to be identified because the talks are private. There was no agreement, they said.

General Motors Corp. and China State Shipbuilding Co. are battling rising materials costs as inflation in China reached 7.9 percent in the first half. China yesterday ordered a cap on prices of energy coal to help producers cope with costs as the country battles a sixth year of electricity shortages.

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The price for hot-rolled coil, a benchmark steel product, has gained 51 percent in the past year, reaching a record 5,957 yuan ($873) a ton on June 5. Coking coal prices more than doubled this year to as much as 2,500 yuan a ton. The global market for coking coal is extremely tight and prices will continue to rise through 2010 on supply constraints, Citigroup Inc.'s analyst Alan Heap said. ArcelorMittal, the world's largest steelmaker, last month said the world may be facing its first steel shortage in decades.

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