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Ministry poised to increase coal prices when time is ripe
The Ministry of Industry and Trade (MoIT) is looking for the most suitable time for a coal price increase after the country's largest coal producer asked the Government to raise the product's price for next year.
Earlier this week, the Viet Nam Coal and Mineral Industries Holding Corporation (Vinacomin) asked the Government to approve its proposed price increase for coal sold to the power industry next year.
Vinacomin deputy general director, Nguyen Van Bien, said his group faced financial difficulties as it currently had to sell coal to power producers at prices much lower than production costs.
He said that coal prices for power producers currently equalled only half of production costs. The current rate for coal price increase was only roughly 30 per cent per year.
"With this increasing rate, it will take three years to have the coal price equal production costs of this year," said Bien.
Meanwhile, he said, the coal industry would have to pay an additional environmental protection fee of VND20,000 per tonne as of next year. In addition, it would have to pay more taxes due to the Government's approval to raise the export tax and mineral resource tax on coal.
However, deputy director of MoIT's Heavy Industry Department, Nguyen Khac Tho said that his ministry would closely examine Vinacomin's proposal to choose the most suitable time for the coal price hike.
MoIT would also consult the Ministry of Finance about the time for a coal price hike before submitting it to the Prime Minister, Tho said, adding that relevant authorities must closely watch the state of the economy given the present context of high inflation.
Tho said that the Prime Minister also instructed to have the coal price rise gradually and in accordance with the market trend, reaffirming that coal price hikes were necessary to help the coal industry reinvest in production.
To reduce difficulties at this moment, Vinacomin also recommended the Government to cut its export tax of alumina from bauxite projects from the current 20 per cent to zero per cent.
vietnamnews
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