Short term coal price may have weak fluctuation space

First of all, from the macro level: in October, PMI was 49.3%, 0.5 percentage points lower than that of last month, running in the contraction range for six consecutive months, indicating the overall downturn of the manufacturing industry. The second is that downstream demand has changed, but the overall downturn will continue. In terms of steel coke, in the past two months, the steel market has shown obvious anti seasonal characteristics: the peak season is not prosperous, and the steel price goes down against the trend. In November, the steel market gradually shifted to the off-season, and it is inevitable that demand will continue to decline. In addition, in addition to Tangshan, Hebei Handan, Shandong Binzhou and Shanxi have issued orange warning of heavy pollution weather recently, which shows that the pressure of environmental protection and production restriction is still large in the later period, which will help to alleviate the downward pressure of steel price, but it is obviously a negative for coking coal demand. In terms of electric power, with the entering of winter heating period, power coal consumption gradually picked up. In addition, at present, it has entered the dry season, and the hydropower output has decreased significantly. In October, the hydropower output has decreased by 4.1% year-on-year, and the decrease has expanded by 3.0 percentage points. Later, the dependence on thermal power will increase. From the perspective of supply, coal production capacity is continuously released and the degree of resource easing is further strengthened. In January and October, the output of raw coal was 320 million tons, up 4.4% year-on-year, and the growth rate was the same as that of last month; the average daily output was 10.48 million tons, down 320000 tons on a month on month basis.

From January to October, the output of raw coal was 3.06 billion tons, up 4.5% year on year. According to the current production situation, the coal output in November will remain at a medium high level, no less than 300 million tons. The over expected increase of imported coal will further aggravate the imbalance of domestic supply and demand. In recent months, China's monthly coal import volume has been around 30 million tons, and the cumulative import volume in the first ten months is basically the same as last year's total import volume. If the country does not introduce strict control measures, the import of coal in the next two months will have a relatively big impact on the domestic market. Third, Shanxi coal mine safety production special inspection has some influence on Shanxi coal production. Since late October, Shanxi has carried out a 30 day special inspection on the safety production of all major coal enterprises in the province. From the current situation, the safety inspection still has an impact on the normal production of local coal mines, and it is expected that the monthly production will be slightly reduced. Through comprehensive analysis, it is preliminarily judged that the domestic coal market in November still maintains a weak trend. In particular, the probability of steel price rebound is large, but the demand for coke and coking coal is difficult to improve significantly. The coking coal market is mainly stable, but the market coal price still has adjustment pressure; the supply of power coal recovers to a high level, the market returns to a loose pattern, and the weak rebound of power coal price caused by short-term replenishment is difficult to change the general trend of adjustment.