Ban to ease inflation worries
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China is banning the hoarding of oil, coal and other commodities to ensure supplies and cool prices.
The moves are China's latest effort to counter unease over inflation that jumped to a 25-month high of 4.4 percent in October. Authorities want to reassure a nervous public the government can handle inflation pressures that some worry could spiral out of control.
The National Development and Reform Commission, China's main economic planning agency, forbade provinces from limiting shipments of coal beyond their borders, ordering them to ensure stable supplies. The Ministry of Commerce, meanwhile, ordered local authorities to crack down on hoarding of oil, gasoline and other fuels, on bogus, or shill, bids meant to drive prices higher, and other illegal practices.
The central bank raised interest rates last month and all signs point to more rate hikes in the months ahead, economists say, as China tries to pull excess cash out of the economy at a time when the United States is trying its best to stimulate growth.
Authorities say soaring food prices - which jumped more than 10 percent in October - are mainly to blame for the current bout of inflation, but costs for fuel and other necessities have also jumped, as supplies have run short.
Coal, which fuels about three-quarters of the country's electricity generation, is a special concern, especially in winter when it also is used in heating systems in the north.
Much of the coal is mined in north-central China and then shipped to big cities, utility plants and factories in the eastern coastal regions.
The NDRC said that some areas, which it did not name, were requiring coal traders to obtain special permits before they can ship coal. "Coal production in some places is rather chaotic and supplies from small mines are unstable," it said.
Seeking to counter widespread shortages of diesel, the Commerce Ministry issued orders aimed at improving monitoring of supplies and what it calls "market order."
"Oil is important to the people's livelihood strategies for goods and materials, local commercial departments at all levels should understand the market supply of refined oil security, stability, the importance of oil prices," said a notice on the ministry's website.
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