Unconfirmed reports say that thermal coal with a calorific value lower than 4500kcal/kg, an ash content of more than 25% and a sulphur content of more than 1% will be banned under new import laws.

The Economic Information Daily reported the plan May 16, citing an announcement at a conference held by the National Development and Reform Commission and the NEA this month.

News agency Platts said it had seen draft regulations released to the local coal industry by the NEA.

The NEA is a government agency responsible for the nation’s energy strategy and, according to Platts market sources, said the measure was designed to lend support to the country's depressed domestic coal industry, which has been beset by falling prices.

Indonesia would likely be hit the hardest by the plan as one of the biggest suppliers of low-CV coal and lignite to China.

Australian coal suppliers look likely to be the biggest winners, being China’s main supplier of high-ash 5500 kcal/kg thermal coal.

Chinese importers would likely buy more of this product and wash down its maximum 23% ash content to blend with domestic thermal coal.

US exporters would likely be affected by the high sulphur quality of their coal.

The reports also suggest the NEA will implement a ban on coking coal imports with more than 12% ash content, 1.75% sulphur and more than 12% total moisture.

The timeline for implementation is not clear, but Platts suggests it may be as early as next week.