In peak season, the price of port power coal has reached a new low since April

The temperature in the north is getting colder, and the heating season is coming this winter. However, in the past, when the demand was the strongest, the price of domestic power coal has been hoarse. In 2018, the port price of 5500 kcal power coal in China reached a maximum of 770 CNY/ton. As of October 24, the average price of 5500 kcal power coal in the port was 601 CNY/ton, 58 yuan lower than the average price of last year On October 30, Jing Wenjuan, an analyst with Zhuo Chuang power coal, told the securities times. On the same day, power coal continued to decline in the domestic futures market. By the end of the morning, the main contract 2001 was 556.4 CNY/ton, down 0.5%. On October 23, the main contract was at a minimum of 553.2 CNY/ton, breaking the low since June 2017, down nearly 10% compared with the price of 610 CNY/ton at the beginning of this year, and 26% compared with the high of 750 CNY/ton at the beginning of 2018. At the same time, the spot price of power coal is not optimistic.

According to the official micro data of Taiyuan coal trading center, the power coal market of northern port has been declining in recent days. Under the pressure of high storage in the port, some self owned coal mine shippers took the lead in selling at a reduced price, but after the price reduction, the sales situation is general, and the price in the downstream continues to be depressed with the decline of market price, resulting in the continuous decline of market price. Up to now, the port's 5500 kcal and 5000 kcal movable coal prices have fallen to the lowest level since late April last year and this year respectively. In terms of the latest market, the market news on October 29 shows that although the port market inquiry has increased at present, the market volume has not increased, some supply enterprises have reduced prices and promotions, the downstream counter-offer is relatively low, the transaction price is stable and slow down, the current market supply exceeds the demand, and participants are pessimistic about the future market expectations. At present, the mainstream price of cv5500 movable coal (s0.6-1) is 565-570 yuan, and the mainstream price of cv5000 movable coal (s0.6-1) is 495-500 yuan. Data from Yulin coal trading center also shows that since the end of the week, Yulin coal price has started a new round of price reduction tide, and some coal mines have lowered their prices twice, with a cumulative maximum drop of 30 CNY/ton so far this week. In the winter heating season of 2016 and 2017, "coal shortage" once occurred in China, and the price of power coal kept rising. Now that the heating season is approaching again, why does the price of power coal continue to decline?

Although it is the traditional peak season at present, the market demand is very poor, and the inventory of each link is very high." Jingwenjuan explained that on the supply side, the supply side reform in 2017 was mainly based on capacity removal, while in 2018 it was mainly based on structural optimization, so the new capacity was gradually increased, which also had a positive impact on capacity increase. At present, the coal mines are basically full production, in addition to the advanced production capacity has been put into production, and the output has increased. From January to September this year, coal production capacity showed an upward trend year on year. At the demand level, due to the coal shortage in the peak season of 2016 and 2017, the power plant suffered serious losses. Therefore, since last year, the power plant has been actively replenishing the inventory in the off-season and maintaining high inventory throughout the year, so there will not be a large demand gap in the peak season. At present, the port inventory is very high, and the downstream power plants are basically maintained in a high inventory state throughout the year. There is no purchase demand in the market now. Most of the downstream power plants are mainly long-term cooperative coal procurement, with the assistance of some imported coal, there are few coal procurement plans for the domestic market, so the downward pressure of coal price is relatively large.

Data shows that as of October 29, the coal storage in QinGang was 6.56 million tons, an increase of 160000 tons compared with the previous day, a decrease of 230000 tons compared with the same period last week, and a decrease of 640000 tons compared with the recent peak of 7.2 million tons on October 14, but it is still at a high level, an increase of 1.19 million tons compared with the same period last year. At the same time, as of October 29, the coal storage capacity of Caofeidian port of SDIC was 4.666 million tons, an increase of 46000 tons compared with the previous day, and a decrease of 40000 tons compared with the same period last week. The amount of coal stored in Jingtang Port of SDIC is 2.04 million tons, an increase of 20000 tons from the previous day and 60000 tons from the same period last week. Huanghua Port has a coal storage capacity of 2.52 million tons, an increase of 107000 tons compared with the previous day, and an increase of 226000 tons compared with the same period last week. According to the data of Taiyuan coal trading center, at present, the coal consumption load of power plant is at a low level, and the replenishment is mainly based on long-term cooperation, while the market coal purchase volume is small. In the near future, the average daily coal consumption of six coastal power plants has remained stable at around 600000 tons, with over 16 million tons of coal stored under a certain replenishment, and the available days have increased to over 28 days.

Due to the continuous low-load operation of inland power plants, the inventory accumulation is fast, which has exceeded 90 million tons. However, the inventory level of coastal power plants is relatively stable, and the entire terminal inventory is high, which restrains the market demand for coal replenishment. At the time when the cost of coal is expected to stop falling and stabilize, the coal production and marketing link has been in deficit. At present, many middle traders in the coal industry are at a loss. The cost of the traders who deliver goods to the port is hanging upside down. Some small-scale traders have stopped doing so. Because big traders have signed contracts with the railway and the downstream, they also need to deliver goods in order to ensure the quantity. " According to Jing Wenjuan, it is normal for traders to make a loss of 30 or 40 yuan per ton of shipment to the port at present, and in many regions the loss is more than 40 yuan. In addition to traders, coal mines will also lose money when they deliver goods to the port because of transportation costs. However, if they are sold by automobile, their profits will be higher. In her opinion, the price of power coal market has not yet stopped falling and stabilized. The prices of producing areas and ports are still falling, and the market is very weak. However, it has been recently reported that coal imports may be limited in the next two months, which will provide the domestic market with stable coal prices.