According to the Commodity Analysis System of SunSirs, the overall trend of thermal coal is up last week. On June 24th, the energy index stood at 887 points, unchanged from yesterday, a decrease of 43.18% from the cycle's highest point of 1561 points (2021-10-21), and an increase of 73.58% from the lowest point of 511 points on March 1st, 2016. (Note: The cycle refers to the period from December 1st, 2011 to the present)

In terms of origin, the coal mines in the production area maintain normal production, with the main focus on implementing long-term cooperative shipping, and the overall coal supply is stable. The rise in coal prices tends to flatten out during the holiday period.

In terms of downstream ports, port prices have slightly increased last week. The main reason for the increase is that with the widespread high temperature weather and the arrival of peak summer, the demand for thermal power has increased rapidly, and the inventory of power plants has decreased, resulting in an increase in demand. The resumption of work and production by non electricity consuming enterprises has led to an increase in energy consumption and an increase in the demand for electricity in the industry.

The production of raw coal remains stable, and imports continue to grow at a high level. In May, the production of raw coal reached 390 million tons, a year-on-year increase of 4.2%, a slowdown of 0.3% compared to April, and the daily average production was 12.43 million tons. The import of coal reached 39.58 million tons, a year-on-year increase of 92.6%, which was 19.9% faster than April. From January to May, the production of raw coal reached 1.91 billion tons, a year-on-year increase of 4.8%. 180 million tons of imported coal, a year-on-year increase of 89.6%

Analysts from SunSirs believe that the overall supply of thermal coal in terms of origin is relatively stable. In terms of downstream ports, due to the recent hot weather, there has been an increase in demand for power plants during peak summer. The demand for non electricity has recently increased. On the cost side, there is positive support for coal prices, but as prices rise, there is a resistance mentality towards high prices in the downstream market. It is expected that the consolidation operation of thermal coal prices will be the main focus in the later stage, depending on the downstream market demand.

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