What is the impact of RMB depreciation on coal?

Coal is the main energy in China and plays an important strategic position in China's economic development. The current domestic coal market has a very obvious international trend; today, the devaluation of the renminbi has a huge impact on China's macroeconomic operations and various industries. What is the impact of RMB depreciation on the coal market? Listen to Foreign Exchange Commission experts.

I. Some coal types are affected

At this stage, RMB depreciation has a great impact on the domestic anthracite market. China exports high-quality thermal coal, coking coal, and coke. The coal produced in Vietnam, Mongolia, and North Korea is mainly anthracite.

Ii. Restraining Market Development

China's coal exports are mainly high-quality thermal coal and coke. If the RMB depreciates, it will increase the export of high-quality coal resources, leading to excess coal in the market.

Iii. Coastal market impacted

The devaluation of the renminbi has a great impact on the coastal coal market. The devaluation of the Renminbi will make international coal prices competitive, and domestic coastal areas will face price shocks first. Some coal users may choose to import coal as fuel. In addition, the trend of RMB depreciation will increase the import cost of coal. It mainly uses the coal industry to import coal, reducing the production cost and making coal possible as an alternative to other energy sources, such as the increase of Coal-fired units, the transformation of fuel and gas units, etc., to increase coal requirements.

Iv. Significant changes in Import and Export

The direct impact of RMB depreciation on the coal market is to reduce exports and imports.