Prices of thermal coal in China, used to fire up power plants, have declined 10 percent so far this year amid an economic slowdown and gradual transition.
The latest benchmark Bohai-rim steam-coal price index showed that the average spot price at six major coal shipping ports in northern China in the week ending July 30 fell further to 570 yuan (93 U.S. dollars) per tonne, down 10 percent from the beginning of the year.
"Coal prices have fallen to five-year lows," Bu Changsen, chairman of Shandong Energy Group Co., Ltd., said. "The whole coal industry is experiencing the worst downturn in more than a decade and therefore most coal firms nationwide are mired in hard times."
Power consumption is a barometer of the state of the economy. Therefore slumps in thermal coal prices could mirror the downward pressure on the Chinese economy, economists said.
Meanwhile, the weak coal market comes as the country is striving to cut some high polluting and energy guzzling capacity to transform the economy into a more sustainable one, said Li Tiegang, deputy president of the school of economics with Shandong University.
Official data also showed that compared with heavy industries, the new and high-tech sectors have better growth momentum and offer hope for the Chinese economy.
