Research on the Influence of Financial Factors on Coal Price at Different Stages

Abstract

Coal is the main source of energy consumption in China and its prices have long been emphasized by various industries. This paper constructs a VAR model to study the impact of futures market factors and economic environment factors on coal prices in two time intervals, which are 2016 to 2020 and 2021 to 2022 respectively, under the background of a huge increase in steam coal prices in Qinhuangdao, China, in 2021 as well as to compare and analyze the results. It is found that some of the financial factors will have impact on the steam coal market price, but the overall impact is not significant. However, after 2021, the impact of financial factors on the steam coal market price deepens. Based on the empirical results, this paper suggests that coal market participants should mainly focus on non-financial factors, but should also take into account the fact that the importance of financial factors will increase under some unexpected circumstances.