Power coal: coal price is waiting for stabilization

Recently, the coal transportation and Marketing Association and other departments have issued proposals on stabilizing the market, calling on major coal enterprises to take a calm view of the current situation, rationally respond to market fluctuations, do not trade in price for quantity in the process of coal sales, do not use no bottom line preferential means to occupy the market, do not conduct market dumping, implement the strategy of production reduction and price protection, and stabilize the coal market. It is reported that on April 16, China coal transportation and Marketing Association sent a letter to Shanxi Energy Bureau, Inner Mongolia Energy Bureau, Shaanxi development and Reform Commission, Ordos Energy Bureau, Yulin Energy Bureau and other major coal producing provinces and autonomous regions to pay close attention to the release of regional output exceeding demand, organize coal production and marketing in a scientific and orderly manner, and put forward several suggestions.

According to the analysis of the latest research report on coal mining industry of Guosheng securities, in the short term, the current coal price has reflected most of the market's negative. From the current point of view, the positive factors gradually occupy the upper hand, the coal market will go out to the dark time, and the coal price is expected to stop falling and stabilize. In the future, the release of supply is slower than the recovery of demand, and the supply-demand pattern is expected to improve marginally. Guosheng Securities pointed out that, on the one hand, the supply level has reached a historical high, and under the call of the association to limit production and protect prices, there is limited space for further improvement in the short term; on the other hand, with the further decline of the impact of the epidemic and the further increase of the counter cyclical adjustment policy, the speed of daily consumption recovery is expected, and the "peak summer" is approaching, the storage and replenishment window; In terms of coal import, import restrictions are expected to rise. At present, the customs clearance policy of coal import in some ports in the south is becoming stricter again.

If the subsequent tightening of coal import policy continues to increase, it will benefit the domestic coal market. In addition, affected by the recent collapse of domestic coal prices, the gap between domestic and foreign import coal prices narrowed, and the advantage of imported coal further narrowed. As of April 16, cci5500 had fallen to 486 CNY/ton from the high of 576 CNY/ton on February 21. After 1320 days, it broke through the 500 CNY/ton integer barrier again and set a new low since August 2016. According to the latest analysis of Huaxi Securities, at present, the power coal is in the off-season, the demand has not seen obvious support, and there is still room for further decline, but it has entered the second half of this round of decline. After May, some power plants will gradually start replenishment, and the price advantage of imported coal will disappear. It is expected that, driven by the market and policy, the import volume will decline, and the price of power coal will gradually stabilize. In terms of the latest port market, market enquiries have increased slightly compared with the previous days, but the counter-offer is still low, and the overall wait-and-see mood of the upstream and downstream has increased, making it difficult to conclude business. In terms of imported coal, under the condition of policy restrictions and sluggish demand, the market transaction was cold. "Market sentiment has gradually stabilized, and under the control of relevant departments, the downstream has gradually sent ships. In late April, there should be a stable price and a drop in inventory, especially for low sulfur coal, and there are not many sources of coal in the market. " A trader said.

As for the downstream power plants, as of April 17, the inventory of six coastal power plants was 16.302 million tons, with a weekly to environmental ratio increase of 195000 tons, a decrease of 85000 tons compared with the same period of last month; the daily coal consumption was 564000 tons, with a weekly to environmental ratio increase of 11000 tons, with an increase of 62000 tons compared with the same period of last month; the available days were 28.9 days, with a weekly to environmental ratio decrease of 0.2 days, with a decrease of 5.2 days compared with the same period of last month. In terms of production area, the demand is general. In order to prevent overstocking of coal mine inventory, some coal mines set production by sales. It is forbidden to sell "one coal" in Yushen area of Shaanxi Province. In addition, the demand is not strong, small mines are overstocked, the output is slightly reduced, and the coal price is reduced by 10-20 yuan. In Jinmeng area, affected by the drop of port price, the purchase volume of surrounding platforms and coal plants decreased, and the price of power plants in inland area was also reduced, the customer's reduction in price was obvious, the sales of coal mines was poor, and the price was reduced by about 10 yuan. According to the evaluation of Fenwei CCI, as of April 17, Yulin 5800 kcal index was 359 CNY/ton, down 32 yuan compared with the same period last month; Ordos 5500 kcal index was 289 yuan, down 49 yuan compared with the same period last month; Datong 5500 kcal index was 335 CNY/ton, down 80 yuan compared with the same period last month.