The market turns better and no hope that coal prices will continue to bottom out

The coal price in Jinmeng area continued to decline, the expectation of the mine side was poor, the heating in North China ended, and the demand of the users decreased; the decline of the superimposed port accelerated, and some customers suspended the shipment. Affected by unsalable and coal price hanging upside down, a few coal mines have reduced production; however, some coal enterprises continue to increase preferential efforts to fixed customers, which makes coal prices continue to decline. This week, the oversupply of the market will continue, and the price of coal from the production area will continue to fall, which is not supported by favorable factors for the time being. In terms of ports around the Bohai Sea, the port market is constantly low-priced. Some small and medium-sized port suppliers are hard to support in the deep decline market and have suspended shipping; however, under the pressure of high inventory, some suppliers are still selling goods at a low price of 8-10 CNY/ton, and the downstream counter-offer is seriously depressed. It is expected that coal prices in the port market will continue to decline this week.

Up to now, the coal storage and availability days of coastal power plants remain at a high level of 29 days. With high inventory and low demand, the demand procurement enthusiasm of major power plants is still low. It is expected that the market weakness will not change in the short term. In the middle of April, the weather is getting warmer and the coal consumption is off-season. Some power plants begin routine maintenance, and the coal consumption of the six power plants is greatly hindered. In addition, after the market coal price fell below Changxie, it continued to fall sharply and showed no signs of recovery. After large-scale coal enterprises successively launched preferential policies, the market pessimism was further aggravated. In the high storage, the power plants mostly delayed the loading period; although there was a slight increase in the number of coal ships arriving at the port, there was no significant boost in the demand side. In terms of coal price, it is still in the decline channel; this week, there is no chance to turn around. First of all, although the inventory of the power plant decreased slightly, the daily consumption did not see a significant increase, and the days of coal storage and availability continued to be at a high level, resulting in the low enthusiasm of users for procurement.

Secondly, with the warm weather in the south, the power of hydropower is about to be generated, and the purchased power is also increasing. The pressure of its own thermal power plant is reduced, and the coal consumption is difficult to be improved. Thirdly, under the downturn of the coal market, large coal enterprises and traders are bidding for each other, and shipping is going down sharply according to the index, so it is difficult to improve the market environment. In the second half of the month, the power plant continued to adopt the strategy of destocking, and the coal price continued to decline. It is expected that by the end of April, the price of coal will fall to 450-460 CNY/ton; subsequently, supported by the shipping cost, and some small-scale households have a bottom reading mind, the market is expected to stabilize and stop falling. After a long time of consumption, coal storage in coastal power plants is gradually close to or even lower than the same period last year, the number of days available for coal storage is further reduced, and the enthusiasm for procurement and transportation has recovered. In June, with some coastal power plants reducing the purchase of imported coal and turning the demand to domestic market, the market will obviously improve, driving up the price of coal.