煤价反弹或受压制!前四月产量下滑明显 山西煤炭增产预期升温

Coal prices are rebounding or being suppressed! Production declined markedly in the first 4 months, and expectations for increased coal production in Shanxi are heating up ·  May 14 23:30

① In the first 4 months of this year, coal production in the Shanxi region dropped significantly. The profitability of some listed companies in the coal industry in Shanxi declined markedly, and the economic growth rate in the Shanxi region slowed. Recently, the Shanxi Energy Administration held intensive meetings, and expectations for an increase in local coal production increased markedly. ② As expectations for increased coal production in the Shanxi region strengthen, the market supply and demand structure may change, and market sentiment will begin to weaken.

Finance Association, May 14 (Reporter Zhang Liangde) In the first four months of this year, coal production capacity in the Shanxi region dropped significantly year on year. Combined market prices dropped more than in the same period last year, and the profitability of some listed companies in the coal industry in Shanxi declined markedly. Meanwhile, under the annual coal production capacity task in Shanxi Province, the industry expects coal production in Shanxi Province to increase starting in May.

A CFA reporter interviewed a number of listed companies and people in the coal industry in the Shanxi region and learned that due to the strict control of coal production in the early stages, the industry expects that Shanxi Province may boost the economy by increasing coal production. Currently, coal mines are still awaiting specific policy notices, but there are already signs that production capacity and output in Shanxi Province are increasing. As market supply expectations increase, market sentiment may weaken, and coal prices may be under pressure.

Will coal production increase in Shanxi?

In the first 4 months of this year, coal production in the Shanxi region dropped significantly, while Inner Mongolia quickly surpassed Shanxi to become the most coal-producing province in the country. According to data from the National Bureau of Statistics, in the first quarter, the country's raw coal production fell 4.1% year-on-year to 1.11 billion tons. Among them, raw coal production in Shanxi was 272 million tons, down 18.9% year on year; during the same period, raw coal production in Inner Mongolia was 324 million tons, up 2.9% year on year.

Also, according to data from the China Coal Distribution and Marketing Association, in early to mid-April, the output of coal companies focused on monitoring reached 106.35 million tons, an increase of 0.9% over the previous month and a year-on-year decrease of 7.4%. Among them, the production of key monitoring coal companies in Shanxi Province fell 22.5% year on year, and Inner Mongolia increased 10.9% year on year.

However, as can also be seen from the announcements of listed companies in the Shanxi region, there was still a large year-on-year decline in production in April. Last night, Lu'an Huanneng (601699.SH) disclosed the main operating data announcement for April 2024. Raw coal production was 4.75 million tons, down 7.77% year on year; commercial coal sales were 3.83 million tons, down 21.19% year on year.

The reporter called the company as an investor to inquire about this. Company staff said that the main reason for the decline in production capacity was poor market conditions and active production reduction factors such as maintenance and security checks.

The economic growth rate of Shanxi Province is slowing down due to factors such as coal production and falling coal prices. According to data recently released by the Shanxi Provincial Bureau of Statistics, the GDP of Shanxi in the first quarter was 539.956 billion yuan, an actual growth rate of 1.2% at constant prices, which is the bottom of the 31 provinces. A number of people in the coal industry in Shanxi Province told the Financial Federation reporter that due to economic development pressure, local coal production may increase to drive economic growth.

A staff member of a listed coal company in Shanxi Province told the Financial Federation: “The policy allows a 10% increase in production on the basis of approved production capacity.”

The reporter learned from a number of people working in the coal industry in Shanxi Province that currently coal mines are still awaiting specific policy notices, but judging from some existing documents and coal mine performance, there are already signs of an increase in coal production in Shanxi Province.

As for listed companies, Huayang Co., Ltd. (600348.SH) announced after the market today that the company recently received documents from the Shanxi Provincial Energy Administration. The Shanxi Provincial Energy Administration completed the registration of production capacity and production factor documentation for the Wenjiazhuang mine of its Pingshu Company. The mine's production capacity increased from 900,000 tons/year to 5 million tons/year.

The reporter learned from people close to the company that the mine is mainly electric coal, while the company also has other coal mines that are undergoing procedures to increase production.

Also, a coal trader in the Jincheng area told the Financial Federation reporter: “The production of our coal mine here has been relatively low for some time. The workers in the coal mine we work with told me that during that time the mine was already preparing to take a double break (previously it was mostly a single break), but now no one in the mine mentioned this again.”

Manager Liu of a private coal company in Shanxi Province told the Financial Federation reporter: “Some coal mines in the Luliang area, such as Datuhe and Zhujiadian, have been working with two production classes and one night maintenance class until now. Now there is news that night production classes will resume, and the coal mines are now waiting for notice.”

Market sentiment may weaken

This round of coal price increases began with the first launch of coking coal prices. Since mid-April, the price of coking coal has rebounded sharply. The price of main coking coal has risen by about 400 yuan per ton, and the price of other types of coal has also risen by varying degrees. For example, the price of small and medium-sized pieces of anthracite in the Jincheng region has risen from 820 yuan/ton to 880 yuan/ton, and the spot price of port thermal coal has risen from around 800 yuan/ton to 860 yuan/ton.

According to the “Work Plan for Stable Coal Production and Stable Supply in Shanxi Province 2024", Shanxi Province targets 1.3 billion tons of coal production in 2024, equivalent to an average of 3.55 million tons per day. In the first quarter, Shanxi produced 271.617 million tons of coal, with an average of 2.98 million tons per day; in the case of low coal production in April, the pressure to increase production was strong in May-December.

As supply-side expectations changed, sentiment in the coking coal market began to weaken in the past two days.

According to my steel statistics, starting May 14, the proportion of coking coal auctions increased dramatically, from 20.5% the previous day to 50.6%, and market sentiment changed markedly.

Some coal mines have also begun to lower coal prices. Yangmahe Mining adjusted the price of No. 13 refined coal to 1,200 yuan/ton at noon today. This price was reduced by about 100 yuan/ton from the previous two days.

Chen Liang, deputy general manager of Shanxi Pocket Coal Coke, told the Financial Federation: “If (coking coal) is increased by 10% from normal production, it should resolve the current supply and demand conflict. On the one hand, although demand-side iron and water production gradually rebounded in March-April, at present, the overall production of molten iron is significantly lower than last year, and market demand will gradually weaken; however, coal production is expected to gradually increase in May-July. Coupled with the continuous increase in imports of Russian coal and Mongolian coal (coking coal), market prices are likely to drop.”

Lu Yang (Douyin: coal is not white), the head of a coal trader in Jincheng, told the Finance Association reporter: “Previously, market prices continued to fall, and the motivation for middle and downstream procurement was very low. Traders did not stock up on coal. Recently, coal prices have continued to rise, and market sentiment has also clearly risen. The middle and lower reaches are buying goods one after another. Currently, many midstream traders as reservoirs have also entered the market. The market is overbought. There is already a flow mark in the past two days, and the risk of traders being harvested has increased.”

Meanwhile, optimism in the thermal coal market has also declined somewhat compared to the previous period. Manager Liu said that although it is currently on the eve of peak summer, it is reasonable to say that downstream power plants should be replenished, but currently judging from the daily consumption and inventory of power plants in 25 provinces, stocks are currently high. At the same time, hydropower is better than in previous years, and hydropower generation has also increased markedly now, which reduces the demand for electricity and coal. Currently, the price of coal arriving in Hong Kong from Indonesia is about 95 US dollars/ton, which is slightly inverted, which supports China's coal prices.

The translation is provided by third-party software.

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