This week Chinese authorities met with representatives of some of the largest power companies in the country to discuss the future of coal in China. A main topic of discussion in the meeting was the measures being taken to reduce the importing of low quality coal. China which is the largest consumer of coal in the world currently suffers from severe air pollution in many of its major cities, critic charge this is caused caused by power plants burning coal.

The meeting was held in Beijing and among those reportedly in attendance were officials from the Ministry of Environmental Protection, the Ministry of Commerce, and the National Energy Administration. The meeting comes months after officials began to increase controls on coal imports causing shipments to face delays at ports.

Industry insiders feel it is likely that Indonesian coal imports could face restrictions or bans as it is considered low quality due to its high sulfur content and low heat value. Giving weight to this idea is the fact that two companies which mainly import Indonesian coal, the Huaneng Group and the Datang Group were among the firms that attended the meeting. Indonesia and Australia are the two largest importers of coal to China.

Uncertainty abounds following the meeting as the lack of definitive measures taken has left ample room for speculation among traders as to what may be the eventual outcome of the meeting. In lieu of specific rules governing imports being published speculation has emerged with coal traders.

For now the traders are expecting extended quality checks when shipments are processed through customs as well other restrictions. However, the lingering possibility of an eventual ban on low quality coal imports serves to keep those in the industry on edge. China has the second largest coal reserves in the world and was prior to 2009 a net exporter of coal.