The price of coal used in the production of cement, paper and fertiliserhas increased by 20-40 percent, following a decision by the Ministry ofFinance.
The sudden move, dated from April 1, resulted from a proposal by theVietnam National Coal, and Mineral Industries Holding CorporationLimited (Vinacomin) based on increases in input prices, interest ratesand the global price of coal.
Before the rise, coal on thedomestic market was sold at 60 percent of the export price and coal foruse in cement, paper and fertiliser production was sold at 50 percentof the export price, a coal industry source said.
This wasa result of the Government's policy to curb inflation, the source said.The cost of petroleum, iron, steel furnaces and exchange rate hadcontributed to add about 3.5 trillion VND (167 million USD) to the costof coal, while export taxes added another 1.3 trillion VND (61.9million USD).
If coal prices had not increased, Vinacomin would have faced financial difficulties, a group spokesman said.
Vinacomin had introduced many technological measures to save costs, butto balance its capital investment in coal production of 15 trillion VND(714 million USD) per year, the group had to have 3 trillion VND (142million USD) corresponding capital a year, the spokesman said.
As a matter of survival the group needed to return to profitability andto fund investment and development. About 3.5 trillion VND (167 millionUSD) was required, he said.
As coal prices were adjusted,the group would improve accommodation, transportation and safetyequipment for mining activities.
Simultaneously, it would maintain production capacity to finance development investment and thus increase productivity.
To meet the national demand to 2015, about 60 million tonnes of cleancoal would be required and Vinacomin's production target for the periodwas 55 million tonnes./.
The sudden move, dated from April 1, resulted from a proposal by theVietnam National Coal, and Mineral Industries Holding CorporationLimited (Vinacomin) based on increases in input prices, interest ratesand the global price of coal.
Before the rise, coal on thedomestic market was sold at 60 percent of the export price and coal foruse in cement, paper and fertiliser production was sold at 50 percentof the export price, a coal industry source said.
This wasa result of the Government's policy to curb inflation, the source said.The cost of petroleum, iron, steel furnaces and exchange rate hadcontributed to add about 3.5 trillion VND (167 million USD) to the costof coal, while export taxes added another 1.3 trillion VND (61.9million USD).
If coal prices had not increased, Vinacomin would have faced financial difficulties, a group spokesman said.
Vinacomin had introduced many technological measures to save costs, butto balance its capital investment in coal production of 15 trillion VND(714 million USD) per year, the group had to have 3 trillion VND (142million USD) corresponding capital a year, the spokesman said.
As a matter of survival the group needed to return to profitability andto fund investment and development. About 3.5 trillion VND (167 millionUSD) was required, he said.
As coal prices were adjusted,the group would improve accommodation, transportation and safetyequipment for mining activities.
Simultaneously, it would maintain production capacity to finance development investment and thus increase productivity.
To meet the national demand to 2015, about 60 million tonnes of cleancoal would be required and Vinacomin's production target for the periodwas 55 million tonnes./.
