Eight conjectures of power coal market in 2020

2019 is over in a flash. Looking back to 2019, the trend of power coal is rising first and then falling. The price of cci5500 power coal entered the green range of coal price in the fourth quarter, and then did not exceed the ceiling of 570 CNY/ton. According to the latest data of China coal resources network, as of December 31, 2019, the annual average price of cci5500 power coal in 2019 is 592 CNY/ton, with a correction of 61 yuan compared with the same period of 2018; the annual average price of cc5000 power coal in 2019 is 514 CNY/ton, with a correction of 63 yuan compared with the same period of 2018. By the end of last year, the price of cci5500 power coal had been reported at 556 CNY/ton, down 87 CNY/ton from the 2019 high of 643 CNY/ton, down 214 CNY/ton from the 2018 high of 770 CNY/ton; the price of cc5000 power coal had been reported at 495 CNY/ton, down 72 CNY/ton from the 2019 high of 567 yuan, down 198 CNY/ton from the 2018 high of 693 CNY/ton.

According to the prediction of power coal market in 2020, the latest research report of Guosheng securities gives eight predictions: 1) the output of raw coal shows moderate expansion; 2) the marginal improvement of coal consumption of thermal power; 3) the strategy of high storage or collapse; 4) the total import volume shrinks to within 300 million tons; 5) the impact of Haoji Railway on the current pattern is limited; 6) the game of coal and electricity intensifies, and the long-term cooperation faces a simultaneous fall in volume and price; 7) the guarantee The national energy strategy is safe, coal to oil meets the development opportunity; 8) the price center of power coal moves down, but the space is limited. In terms of the price trend of power coal in 2020, Guosheng securities research report points out that 2020 is the end of the 13th five year plan. On the premise of further consolidating and optimizing the results of supply side reform, the policy focus will still focus on the accelerated release of advanced production capacity and optimization of supply structure. In 2020, the power coal supply capacity will continue to improve, the bottleneck of railway transportation will be basically solved, and the improvement effect of demand end to link ratio is limited, and the overall supply and demand pattern will continue to maintain a loose pattern.

In the future, the pace of power plant destocking, replenishment and coal import policies will jointly affect the coal market price in 2020. In 2020, the supply and demand will continue to be loose, and the market-oriented electricity price mechanism will suppress the medium and long-term price. It is estimated that the port power coal price operating range is 520-570 CNY/ton, and the center will continue to move down to 540 CNY/ton. Up to now, according to the comprehensive analysis report, there is a general consensus on the downward shift of coal price center in 2020. For the coal market in 2020, analysts believe that in the future, with the continuous release of new coal production capacity and the continuous improvement of the level of new energy development, the supply of coal market will further shift to a loose direction. On the whole, it is more likely that the price center of coal market will continue to move down in 2020. At the 7th international power coal resources and Market Summit Forum held in Guangzhou on November 21 last year, Liu Xinhua, deputy general manager of Fenwei energy, said that in 2020, the power coal supply capacity will continue to improve, the railway transportation capacity will increase, the imported coal will maintain a high level, the supply growth rate will be faster than the demand growth rate, the supply and demand will continue to ease, and the market-oriented pricing mechanism will suppress the medium and long-term coal price.

It is expected that the price focus of power coal will continue to move down to about 540 CNY/ton in 2020. According to the analysis of securities times.com, it is expected that the supply will decelerate and the demand structure will improve in 2020, but the overall pattern of loose supply cannot be effectively reversed, and the coal price is still in a weak state, but the demand in the second half of the year is expected to enter the improvement channel, and the coal price is expected to show the rhythm of quarterly improvement. It is estimated that in 2020, the average port price of power coal will decrease by 4-5% year on year, from 585 yuan in 2019 to 550-560 yuan, and the price of Changxie coal will decrease by about 1%, while the mine mouth price is expected to decrease by about 2% year on year due to the support of inland demand structure. In addition, on January 3, at the 2020 coal and power industry outlook report meeting, Han Lei, general manager of China coal network research department, believed that the transportation capacity of the railway at the transportation end continued to improve, and the transportation capacity was loose as a whole. The normalization of policy control at the import end will affect the decline of the advantage of imported coal. It is expected that the overall domestic supply and demand situation will be relatively loose in 2020, the price gap between domestic and foreign countries will be gradually reduced, the import power will be weakened, and the import scale may be reduced to about 300 million tons.

On the demand side, under the comprehensive expectation that the growth rate of coal consumption in iron and steel, building materials industry and some high energy consuming industries has slowed down significantly, the power industry has maintained the current situation, and the chemical industry has limited growth, it is estimated that the total coal demand in 2020 will be 4.1-4.2 billion tons, and the growth rate will slow down significantly compared with that in 2019. "The overall supply and demand of coal market in China is in a weak balance, and the spot price of power coal in coastal areas will fall back to the green range, fluctuating between 535-590 CNY/ton. In 2020, there will be subtle changes in the pricing system and marketing system of the coal market. Affected by this, the ability of futures pricing will be enhanced, which will also bring new changes to the spot market pricing. " Han Lei said.