CHINA Shenhua Energy Co., the country’s top coal miner, has raised its August coal prices after two consecutive months of cuts, trade sources said Tuesday, in a move that may offer some relief to an industry suffering big losses.

    The price hike by Shenhua comes as more than 70 percent of China’s coal firms are already making losses in the first half, according to the country’s coal association, with prices eroded by falling demand growth, a worsening supply glut and a war on smog.

    Shenhua raised prices for benchmark coal with heating value of 5,500 kcal/kilogram by 4 yuan to 489 yuan (US$79.25) for August, while its tier-1 quality coal (5,800 kcal/kilogram) was unchanged at 535 yuan a ton, traders said.

    “We’re about to enter a seasonal demand lull and orders will start to fall by mid-August. If the big boys don’t find ways to support the market, prices will drop further and the outlook will be very, very grim,” said a Shanghai-based trader.

    Hit by persistent oversupply and slackening demand, China’s benchmark thermal coal prices have been steadily falling since the start of the year and are now hovering at their lowest in more than six years, putting more and more miners under duress.

    Taking the lead from the industry leader, China National Coal Group, the country’s second-largest producer, swiftly followed suit and hiked prices by a similar amount for August delivery, industry website China Coal Transport and Distribution Association (CCTD) reported Tuesday.

    Traders said the brief increase in spot demand from power plants during the searing summer would offer a reprieve for miners, with industry data from CCTD showing that average daily coal consumption by major coastal power plants has risen to about 700,000 tons from about 600,000 tons in mid-July. (SD-Agencies)