SunSirs: China Thermal Coal Prices Consolidated This Week (January 29- February 4)

According to the Commodity Analysis System of SunSirs, the price of thermal coal has been consolidating this week. On February 3rd, the energy index was 1,022 points, unchanged from yesterday, a decrease of 34.53% from the highest point in the cycle of 1,561 points (2021-10-21), and an increase of 100.00% from the lowest point of 511 points on March 1st, 2016. (Note: The cycle refers to 2011-12-01 present)

In terms of production areas, as the Spring Festival approaches, some coal mines have started to holiday one after another. Overall, the supply of coal from the main production areas has decreased. Additionally, due to recent rainy and snowy weather and poor transportation, the purchasing demand for terminal power plants is average, and the market activity is not high. And the overall focus is on implementing long-term coal cooperation.

In terms of downstream ports, the overall coal prices have stabilized this week, with less market demand, and the transportation is mainly based on long-term cooperative coal. Downstream on-demand procurement market, there is currently no significant change in the demand side, and there is already a holiday state in trade. The available resources at the port are limited, so be cautious and wait and see.

The National Bureau of Statistics announced that in 2023, industrial enterprises above designated size achieved a revenue of 133.44 trillion RMB, an increase of 1.1% compared to the previous year. The mining industry achieved a revenue of 6,127.51 billion RMB, a decrease of 8.6% from the previous year. Among them, the coal mining and washing industry realized an operating income of 3,495.87 billion RMB, down 13.1% over the previous year. In 2023, industrial enterprises above designated size in China achieved a total profit of 7,685.83 billion RMB, a decrease of 2.3% from the previous year, and a decrease of 2.1 percentage points from January to November. The mining industry achieved a total profit of 1,239.24 billion RMB, a decrease of 19.7% from the previous year. Among them, the coal mining and washing industry realized a total profit of 762.89 billion RMB, down 25.3% over the previous year.

SunSirs analysts believe that as the Spring Festival approaches, long-term cooperative shipping has been implemented as the main focus. In terms of downstream ports, prices have stabilized this week. Power plants tend to adopt a wait-and-see attitude and purchase according to demand. Overall, it is expected that the price of thermal coal will be mainly adjusted based on downstream market demand.

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