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SunSirs: China Thermal Coal Price was Running strongly Last Week (September 21-25)

September 27 2020 10:54:30     SunSirs (Selena)

According to the monitoring of SunSirs, the price of thermal coal was mainly stable last week. On September 21, the average port price of thermal coal was maintained at 594 RMB/ ton, and on September 25, the average port price of thermal coal was maintained at about 598 RMB/ ton, with a price increase of 0.67% and a year-on-year increase of 1.66%. On September 24, the commodity index of thermal coal was 71.78, unchanged with the previous day, down 30.32% from 103.01 (2011-11-15), and 60.58% higher than the lowest point of 44.70 on January 20, 2016. (Note: period refers to 2011-09-01 to now)

Analysis of Influencing Factors

In terms of production area, Shaanxi cement chemical industry has a good purchasing enthusiasm, most coal mine quotation is temporarily stable, and some coal mines are slightly increased. The price of coal in Ordos region of Inner Mongolia has been rising steadily. Compared with Shaanxi Province, the number of coal mines with price adjustment is relatively small. The price of a few coal mines has increased by about 5-10 RMB, while the price of other coal mines is temporarily stable. With the holiday approaching, the inspection of the main coal producing areas is upgraded, coupled with the restriction of coal pipe tickets, the coal supply tends to be tight.

In terms of downstream power plants, the mainstream closing price of 5,500 kcal thermal coal in the port is about 593-603 RMB/ ton. The daily consumption of power plants is low, the inventory of North port is fluctuating downward, and the supply of high-quality goods is in short supply. The port coal price is close to this year's high and red range. In September, the precipitation dropped seasonally and the inflow and outflow of the Three Gorges Reservoir decreased significantly. Hydropower is still stronger than in previous years, but the substitution of thermal power will become weaker. Power plant replenishment started. In the middle and late September, the power plant ushered in seasonal replenishment cycle, thus boosting the price of thermal coal.

SunSirs Analysts believe that: in the near future, hydropower generation has maintained a high level, which has squeezed the thermal power plants. In addition, the demand for electricity by residents has weakened after autumn. The characteristics of electricity coal consumption in the off-season are obvious, and the energy of end-users to make up the reservoir at the end of the season has weakened. According to the data, the daily coal consumption of Zheneng power, one of the six major coastal power plants, was 107,000 tons on September 23, a decrease of 27,000 tons compared with 134,000 tons at the beginning of the month, and an increase of 14,000 tons compared with the same period last year. In a comprehensive view, the short-term thermal coal price in China may maintain the consolidation trend, which depends on the downstream market demand.


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