SunSirs: Energy, Strong Performance of Thermal Coal Price on May 25

According to the monitoring of SunSirs, the price of thermal coal (port) was around 543 RMB/ ton, up 3.77% per day. On May 24, the thermal coal commodity index was 63.04, which was the same as the day before, 38.80% lower than 103.01 (2011-11-15), the highest point in the cycle, and 41.03% higher than 44.70, the lowest point on January 20, 2016. (Note: cycle refers to 2011-09-01 to now)

The recent performance of thermal coal price is strong. On the whole, in the context of production reduction, overhaul of Daqin line, sharp drop in port inventory, and increasingly strict import restrictions, daily coal consumption of coastal power plants soared, and power plant inventory. Under the boost of high daily consumption, the power plant continued to maintain de stocking in the near future. From the downstream power plant to May 22, the daily coal consumption of six power plants was 675,400 tons/ day, with a weekly to environmental ratio of 1500 tons/ day. As of May 22, the inventory of Qinhuangdao port was 3.89 million tons, with a decrease of 475,000 tons in the weekly to environmental ratio; as of May 22, the total inventory of six major power plants was 14.16 million tons, with a decrease of 5,555,000 tons in the weekly to environmental ratio. In the near future, the market purchasing enthusiasm has increased significantly, driven by the fast speed of de stocking, the up coming of summer peak replenishment. In addition, import restrictions are becoming more stringent. From January to April, the coal import volume is close to 130 million tons. If calculated according to the rumored import quota of 250 million tons in the market at the beginning of the year, the remaining import quota is less than 50%, part of the port import quota has been exhausted, and the import restrictions are stricter.

According to the analyst of SunSirs, the main data of industrial production above Designated Size from January to April 2020 from the National Bureau of statistics, in April, the national raw coal output was 322.12 million tons, an increase of 6.0% year on year. From January to April, the national raw coal output was 1,152.44 million tons, up 1.3% year on year. In April, the output of raw coal was 322 million tons. Although the month on month ratio dropped, the year-on-year growth was still 6%. After structural adjustment on the supply side, with the release of high-quality production capacity, the domestic coal supply capacity steadily increased. Generally speaking, the price of thermal coal will keep rising in the short term, but in the long term, the price of thermal coal will return to rationality.

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