CHINA’S thermal coal futures hit record highs yesterday after four top utilities warned of potential heating and electricity shortages and as the worst blizzards this winter continued to blast some central and southern provinces.

Last week, State Power Investment, China Datang, China Huaneng Group and China Huadian asked the government to boost supplies of coal and temper a months-long rally in prices.

The most active futures were up 1.34 percent at 678.8 yuan (US$107.04) per ton, after earlier touching 679.6 yuan, their highest since the contract began in 2015.

Thermal coal futures have jumped more than 10 percent this year, extending a months-long rally, as utilities rush for supplies to deal with soaring power demand as cold weather sweeps across swathes of the nation.

“The price rally is being driven by blizzard weather across the country, which has blocked highways and even rail transportation in some places and boosted demand for heating,” said Xu Bo, analyst at Haitong Futures.

“It is hard to ease tight coal supply in a short period since China is currently at its peak period for heating.”

However, Xu said he expected coal prices to fall eventually as they were already above levels the country’s utilities could afford, although that could take some time.

Renewing worries about the country’s winter heating crisis, Jiangxi and Hunan provinces have introduced power rationing to industrial users due to heavy snowfall, with snowy storms also striking parts of the provinces of Anhui, Jiangsu, Zhejiang, Hubei and Hunan.

In Jiangsu, the authorities posted a letter on their website asking utilities to ensure sufficient power for heating because of bad weather and snarled transportation. (SD-Agencies)