Coal a golden commodity

"Vicem cement factories need around 5,000 tonnes of dust coal for production a day. However, our chief supplier Vinacomin can only satisfy half the demand," said Vicem's office chief Nguyen Thanh Tung.

He added that though Vinacomin had ameliorated coal supplies to Vicem in recent days, its affiliates were still struggling to operate.

The shortages were due to weather not being favourable for coal extraction, cement sector demand for coal having surged 36 per cent as scores of cement plants were brought online. However, the coal sector also saw a 5 per cent hike in production despite its considerable efforts for production expansion.

At least three to five production lines at Vicem saw a halt in production due to lack of coal, one at Ha Nam province's But Son Cement Joint Stock Company, one at Hai Duong province's Hoang Thach Cement JS Company and one at Thanh Hoa province's Bim Son Cement JS Company.

The Cement Materials and Transportation JS Company (Comatce) was trusted by Vicem to sign coal buying contracts with Vinacomin to supply Vicem member units.

In early 2010, Comatce and Vinacomin inked a contract under which Vinacomin pledged to provide the cement sector with 1.5 million tonnes of assorted coal in 2010, up 20 per cent against 2009's 1.25 million tonnes.

Vinacomin had supplied Vicem with 1.18 million tonnes of coal by the end of September, up to the schedule set in the contract signed between Vinacomin and Comatce early this year, said Vinacomin's deputy general director Le Minh Chuan.

Vicem recently asked Vinacomin to provide 150,000 tonnes of coal to the year's end and the latter had asked its member companies to make strides to be able to satisfy Vicem's requirement in whole or in part.

The possibility of buying coal from suppliers other than Vinacomin was also considered. However, the outcome was still not visible as the last quarter is often a peak period in coal consumption.

The coal stockpiled amount at cement plants remains quite modest. Hoang Thach Cement JS Company currently has 5,700 tonnes of coal in stock, the figure is more than 10,000 tonnes at Hoang Mai, 6,600 tonnes at Tam Diep and 2,500 tonnes at Bim Son cement companies, sufficient for five to 15 days production.

In the long haul, domestic companies needed to diversify input coal sources for production, rather than relying mostly on Vinacomin or domestic supply, said the group's deputy general director Le Minh Chuan.