How greatly can a world event like the Olympics affect a country's power production and consumption?
China Olympic Ban on Hazardous Goods Cuts Coal Output
China's restrictions on transporting hazardous materials near Olympic venues have disrupted some coal and plastics production by strangling deliveries of explosives and raw materials.
Small mines in Shanxi, the province that leads China's coal production, have had to halt blasting, Zhang Wenjiang, assistant general manager of Shenhua Group Corp., said. Some makers of polyvinyl chloride, or PVC, have suspended output because of disruptions related to the Olympics, said Lee Chih-tsuen, chairman of Formosa Plastics Corp., the world's second-biggest maker of the plastic.
Security has become an increased priority for Olympic organizers since police said they uncovered two terror plots aimed at the Aug. 8-24 Games. The restrictions, announced on July 11 by the Ministry of Public Security, ban the land transportation of guns and ammunition, along with explosive, toxic and radioactive materials.
"It's affecting the production of coal a great deal," said Andy Xie, founder of Rosetta Stone Advisors in Shanghai and formerly Morgan Stanley's chief Asia economist. "Coal supply is very tight now," Xie said by phone.
While the Games are centered on Beijing, Tianjin, Shanghai, Shenyang, Qingdao, Qinhuangdao and Hong Kong are also hosting events. The restrictions remain in place until after the Sept. 6-17 Paralympics.
Shenhua, China's largest supplier of the fuel, isn't affected because it doesn't rely on explosives to extract coal, Zhang said in Beijing. He declined to estimate the extent of the company's lost production.
The ban may worsen domestic coal shortages caused by existing constraints in the country's transportation network and the closure of small, unsafe mines. Nationwide deficits of the fuel have reached 40 million metric tons, Wu Chenghou, adviser to the China Coal Transport and Distribution Association, told reporters in Beijing today.
China relies on coal for almost 80 percent of its electricity generation. The shortfalls have shut 2.5 percent of the country's coal-fired power plants, the State Grid Corp of China, the nation's largest power distributor, said.
Reflecting the fuel deficits, the average price of coal rose 19 percent in the first five months of this year to 307.66 ($45) a metric ton, the transportation association said at the Asia-Pacific Coal Market Summit.
Prices of coking coal, used by steelmakers, may rise by a further 200 to 300 yuan a ton, Liu Jianzhong, deputy general manager of Shanxi Coking Coal Group Co., said at the conference. They have doubled in 2008.
Public safety regulations related to the Olympics may affect producers and suppliers of "certain kinds" of petrochemicals, William Zhu, deputy director of information at the China Petroleum and Chemical Industry Association, said by phone in Beijing.
Authorities are limiting the production and sales of 257 petrochemicals in the capital between May 1 and Oct. 17, according to a circular posted on the Web site of the China Polyurethane Industry Association.
Formosa Plastics' 400,000-metric-ton-a-year PVC plant in the city of Ningbo on China's eastern coast won't be affected by Olympic regulations because its raw materials arrive by sea and no ground transportation is involved, Lee said by phone in Taipei.
The restrictions will have "limited impact" on the operations of Sinopec Beijing Yanshan Co., a unit of China Petroleum & Chemical Corp., Zhou Zhiyi, director of information at Sinopec Yanshan, said by phone. The Beijing-based company, which makes resins, plastics and synthetic rubber, had increased its stockpile of raw materials before the ban was imposed, Zhou said.
Sinopec Yanshan won't suspend operations during the Olympics, Zhou said.
Small mines in Shanxi, the province that leads China's coal production, have had to halt blasting, Zhang Wenjiang, assistant general manager of Shenhua Group Corp., said. Some makers of polyvinyl chloride, or PVC, have suspended output because of disruptions related to the Olympics, said Lee Chih-tsuen, chairman of Formosa Plastics Corp., the world's second-biggest maker of the plastic.
Security has become an increased priority for Olympic organizers since police said they uncovered two terror plots aimed at the Aug. 8-24 Games. The restrictions, announced on July 11 by the Ministry of Public Security, ban the land transportation of guns and ammunition, along with explosive, toxic and radioactive materials.
"It's affecting the production of coal a great deal," said Andy Xie, founder of Rosetta Stone Advisors in Shanghai and formerly Morgan Stanley's chief Asia economist. "Coal supply is very tight now," Xie said by phone.
While the Games are centered on Beijing, Tianjin, Shanghai, Shenyang, Qingdao, Qinhuangdao and Hong Kong are also hosting events. The restrictions remain in place until after the Sept. 6-17 Paralympics.
Shenhua, China's largest supplier of the fuel, isn't affected because it doesn't rely on explosives to extract coal, Zhang said in Beijing. He declined to estimate the extent of the company's lost production.
The ban may worsen domestic coal shortages caused by existing constraints in the country's transportation network and the closure of small, unsafe mines. Nationwide deficits of the fuel have reached 40 million metric tons, Wu Chenghou, adviser to the China Coal Transport and Distribution Association, told reporters in Beijing today.
China relies on coal for almost 80 percent of its electricity generation. The shortfalls have shut 2.5 percent of the country's coal-fired power plants, the State Grid Corp of China, the nation's largest power distributor, said.
Reflecting the fuel deficits, the average price of coal rose 19 percent in the first five months of this year to 307.66 ($45) a metric ton, the transportation association said at the Asia-Pacific Coal Market Summit.
Prices of coking coal, used by steelmakers, may rise by a further 200 to 300 yuan a ton, Liu Jianzhong, deputy general manager of Shanxi Coking Coal Group Co., said at the conference. They have doubled in 2008.
Public safety regulations related to the Olympics may affect producers and suppliers of "certain kinds" of petrochemicals, William Zhu, deputy director of information at the China Petroleum and Chemical Industry Association, said by phone in Beijing.
Authorities are limiting the production and sales of 257 petrochemicals in the capital between May 1 and Oct. 17, according to a circular posted on the Web site of the China Polyurethane Industry Association.
Formosa Plastics' 400,000-metric-ton-a-year PVC plant in the city of Ningbo on China's eastern coast won't be affected by Olympic regulations because its raw materials arrive by sea and no ground transportation is involved, Lee said by phone in Taipei.
The restrictions will have "limited impact" on the operations of Sinopec Beijing Yanshan Co., a unit of China Petroleum & Chemical Corp., Zhou Zhiyi, director of information at Sinopec Yanshan, said by phone. The Beijing-based company, which makes resins, plastics and synthetic rubber, had increased its stockpile of raw materials before the ban was imposed, Zhou said.
Sinopec Yanshan won't suspend operations during the Olympics, Zhou said.
Is hosting the Olympics worth the stress China will endure, particularly in light of a looming power shortage?
posted by Charltonmedia.com @ 8:37 PM
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