On December 4th, the domestic thermal coal market showed a weak pattern of "loose supply and demand, sluggish transactions, and bearish sentiment". The linkage between port and origin prices has declined, downstream procurement demand is weak, and market bearish expectations have strengthened.

Port market: Price reduction, sluggish transactions

Price performance: The quotations for thermal coal of various calorific values have generally declined. The quotation for 5,500 kcal is 810-820 RMB/ton, for 5,000 kcal it is 710-720 RMB/ton, and for 4,500 kcal it is 610-620 RMB/ton.

Trading is light, with downstream mainly adopting a wait-and-see approach, with only a small amount of rigid demand support. The pessimistic sentiment among traders is spreading, and there is a clear phenomenon of price suppression in bidding. Port inventory continues to accumulate, cost support weakens, and sellers' willingness to lower prices and ship increases.

Short term outlook: The price decline may continue until mid December, and the price of 5,500 kcal coal may approach 800 RMB/ton.

Main Origin Market: Price Pressure, Regional Differentiation

Shaanxi region: weakly stable operation, loose supply and demand. The price of 6,000 kcal coal is 650-680 RMB/ton, and 5,800 kcal coal is 610-640 RMB/ton. Non electric terminal industry procurement is sluggish, traders are on the sidelines, and market expectations are bearish.

Inner Mongolia region: Weakness continues, coal mines actively reduce prices. The price of 5,500 kcal coal is 560-600 RMB/ton, and the price of 5,000 kcal coal is 470-510 RMB/ton. Downstream essential procurement is the main focus, and there is still room for coal prices to decline under inventory pressure.

Shanxi region: Overall downward trend, coal enterprise inventory pressure differentiation. The price of 5,500 kcal coal is 590-640 RMB/ton, and the price of 5,000 kcal coal is 520-570 RMB/ton. Some coal companies have reduced prices for promotions, but the transaction volume is weak and the demand release is insufficient.

Price dynamics and regional performance

Latest price adjustment: Inner Mongolia and Shanxi's various calorific value coal types have generally dropped by 10 RMB/ton; Prices in Shaanxi are temporarily stable.

Regional performance:

Yulin: Demand is sluggish, and coal mines are increasing their efforts to reduce prices and promote sales.

Erdos: Ensuring supply and shipping is the main focus, with sluggish coal trading in the market and a decline in pithead prices.

Jinbei: Due to the transmission of port price drops, coal plants have a low willingness to stockpile goods, and rigid demand procurement is the main focus.

Market Core and Future Outlook

core contradiction

High temperature: The cold wave during the heating season has not yet arrived, and the national temperature is higher than in previous years. The year-on-year increase in daily consumption of power plants is limited. High inventory: Port and power plant inventories continue to accumulate, and the destocking process is slow, suppressing procurement demand. Weakening sentiment: Large enterprises' purchase prices have decreased, exacerbating market bearish expectations.

Future prospects

Price expectation: There is still room for a decline of about 30 RMB/ton in port thermal coal prices, and the decline in production areas may exceed 50 RMB/ton. If daily consumption continues to be sluggish, the decline may widen. The probability of a weak market operation in the first half of December is high, and price support is gradually weakening. The subsequent stabilization needs to wait for the recovery of daily consumption and the effective elimination of inventory.

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