SunSirs: Weak Demand, China Thermal Coal Market is Stable and Weak

https://www.chemnet.com   Aug 09,2024 SunSirs

Recently, the overall stability of the domestic thermal coal market has been relatively weak, and the thermal coal market in Ordos is currently operating steadily. The mainstream market price of Q5000 large calorie thermal coal in the Ordos region is between 550-570 RMB/ton, unchanged from the previous working day; The mainstream market price of Q5500 large truck thermal coal is between 650-670 RMB/ton, unchanged from the previous working day. Most coal mines in the region maintain normal production and sales, mainly through long-term supply guarantee agreements, and the overall coal supply level remains normal.

The thermal coal market in Shaanxi is operating weakly and steadily. Most coal mines are operating normally, while a few have stopped production and reduced output due to reasons such as relocation or face collapse. The overall supply is basically stable. The mainstream market price of Q6000 large calorie thermal coal in Yulin area is 735-750 RMB/ton, a decrease of 2.5 RMB/ton from the previous working day; The mainstream market price of Q5500 large calorie thermal coal in Datong area is between 715-735 RMB/ton, a decrease of 5 RMB/ton from the previous working day;

The mainstream market price of Q5000 large truck thermal coal in Shandong region is between 770-790 RMB/ton, unchanged from the previous working day. Most coal mines in the production area maintain stable production, and downstream users have relatively average purchasing enthusiasm, mainly following up on urgent needs. Market prices are stable, weak, and adjusted narrowly.

In terms of imports: Price difference of imported thermal coal: The landed price of Q3800 imported from Indonesia to South China is about 512 RMB/ton, which is 87.5 RMB/ton lower than that of domestically traded coal with the same calorific value in South China ports; The landed price of Q4500 in South China, Indonesia is about 645 RMB/ton, which is 65 RMB/ton lower than domestic coal with the same calorific value in South China ports; The landed price of Australian coal 5500 in South China is about 865 RMB/ton, which is 45 RMB/ton lower than domestic coal with the same calorific value in South China ports. This week, market sentiment has heated up slightly, with domestic coal prices rising slightly. Against this backdrop, imported coal prices still have a clear advantage. It is expected that the price of imported coal will continue to fluctuate slightly in the short term, and attention should be paid to the quotation of foreign mines and the daily consumption of power plants in the future.

In terms of origin: August is the hottest month of the year, especially during the dog days of March. Continuous high temperatures across the country have become the norm, causing electricity loads to soar and coal power generation to become the main force in ensuring supply. However, the current coal market is facing challenges, with unstable market conditions and a lukewarm market.

In terms of port: The price of thermal coal in the port market is running steadily. The upstream production areas maintain normal supply status quo, mainly through long-term contract shipping, and the market sales department is in a wait-and-see state. At present, port inventory is slowly rising, and traders' willingness to ship is increasing, resulting in a slight decline in quotes. At present, the overall market upstream and downstream are mainly cautious, and the trading atmosphere is quiet. In the short term, the fluctuation of coal prices will be relatively small, and the price will be mainly stable. In terms of price, the current closing price of Qinhuangdao Port Q5500 is 850 RMB/ton, Q5000 is 755 RMB/ton, and Q4500 is 655 RMB/ton.

Recently, the overall stability of the domestic thermal coal market has been weak, with some areas showing signs of loosening and downward trend. The coal mines in the production area that suspended production and sales at the end of last month have gradually resumed normal production, but the pace of coal sales in the market is not fast, and some mine mouths have accumulated coal reserves; Downstream users have low purchasing enthusiasm, power plant long-term cooperative resources are sufficient, and non electric terminals are affected by poor profit performance to control the pace of procurement, resulting in weak demand side support.

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