Ulaanbaatar /MONTSAME/ On May 10-11, representatives of ‘Erdenes Tavan Tolgoi’ JSC held a regular meeting with Chalco Trading Hong Kong Co Limited to raise coal price and update the price index.

At the meeting, the sides reached an agreement to raise the coal price, which was unchanged since 2017, to USD60 or by 70 cents per ton.

In addition, Chalco Trading Hong Kong Co Limited pledged to study a request by ETT JSC to increase the price to USD61.35, introducing the request to its Board of Directors and give a response next week.

The sides also agreed to make two kinds of updates in the price adjustment mechanism or price-indexing methodology, within the framework of correcting the mechanism's disadvantages in the agreement established in 2011 with Chalco Trading Hong Kong Co Limited. Specifically, one more indice will be added. By doing so, the price will be calculated in accordance with five indices, which changes the index basket coefficients.  As a result, it decreases CR China Coking Price Index, which was at 60 percent, to 30 percent.

It creates advantages to raise the price in harmony with market growth, bring the price closer to the coal price of West Tsankhi mine within 1 and 1.5 years, and protect from risks that may occur when coal prices fall.
 

Published Date:2018-05-14