SunSirs: Weak Performance of China Thermal Coal Prices in January, 2024

According to the commodity market analysis system of SunSirs, the price of thermal coal was weak in January. On January 30th, the energy index was 1,021 points, a decrease of 1 point from yesterday, a decrease of 34.59% from the highest point in the cycle of 1,561 points (2021-10-21), and an increase of 99.80% from the lowest point of 511 points on March 1st, 2016. (Note: The cycle refers to 2011-12-01 present)

The price of thermal coal has been weak this month. The prices of coal mines in the main production areas have been consolidating, with some coal mines adjusting their prices slightly based on transportation conditions. As the Spring Festival approaches, limited coal mines are gradually taking breaks, but now the purchasing demand for terminal power plants is average and the market activity is not high. Port coal prices are weak, market demand is low, and transportation is mainly based on long-term cooperative coal. Traders have hopes for an increase in coal prices, and still adopt a wait-and-see attitude. Recently, the temperature has dropped, but the daily consumption of power plants has not shown a significant performance, and the non electric industry is mainly based on on-demand procurement.

According to data recently released by the National Bureau of Statistics, prices of various coal types in China continued to decline in mid January. The specific price changes of each coal type are as follows: the price of anthracite (washed lump, volatile content≤8%) is 1,012.1 RMB/ton, a decrease of 22.2 RMB/ton from the previous period, a decrease of 2.1%. The price of ordinary mixed coal (a mixture of Shanxi fine coal and lump coal with a calorific value of 4,500 kcal) is 702.7 RMB/ton, a decrease of 9.9 RMB/ton from the previous period, a decrease of 1.4%. The price of Shanxi Damian (a high-quality mixed coal with a calorific value of 5,000 kcal) is 805.7 RMB/ton, a decrease of 16.2 RMB/ton from the previous period, a decrease of 2.0%. The price of Shanxi Youmix (high-quality mixed coal with a calorific value of 5,500 kcal) is 915.7 RMB/ton, a decrease of 16.2 RMB/ton from the previous period, a decrease of 1.7%. The price of coking coal (main coking coal with sulfur content<1%) is 2,375.0 RMB/ton, a decrease of 135.7 RMB/ton from the previous period, a decrease of 5.4%.

SunSirs analysts believe that in terms of origin, the recent increase in coal mine prices due to the increase in coal mine holidays has led to poor enthusiasm among traders for shipping. In terms of downstream ports, prices are operating weakly. Power plants tend to adopt a wait-and-see attitude, purchasing according to demand, and still focusing on supplementing long-term coal. It is expected that the price of thermal coal will mainly consolidate, depending on downstream market demand.

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