Policy overweights will drive coal prices to a high level, and July may become the deadline for price cuts
On June 26, the National Development and Reform Commission emphasized that there is no basis for a substantial increase in coal prices, and it is expected that July will usher in a significant decline; this statement directly suppressed market sentiment and drove the coal price on June 28 The sector and the coal futures market are simultaneously falling.
On June 28, ZCE’s thermal coal futures fell more than 7%, and the main contract price fell to 790.2 yuan/ton; coking coal futures fell more than 4% to close at 1978.00 yuan/ton, closing down 3.77%.
In the A-share market, the coal sector fell sharply on June 28.Huaibei Mining（600985.SH）、Haohua Energy（601101.SH）、Shanmei International(600546.SH) and many other coal stocks stopped falling and closed,Anyuan Coal（600397.SH）、Yanzhou Coal Industry(600188.SH) etc. fell more than 6%.
The current demand is still strong, the safety inspection efforts are not reduced, the stable supply and demand fundamentals are under pressure from the policy side, and coal prices continue to be adjusted at a high level.
Policy factors dominate the market decline
On June 26, the relevant person in charge of the National Development and Reform Commission stated that, so far, the National Development and Reform Commission has worked with relevant parties to fully promote the increase in coal production and supply, promote the release of high-quality production capacity, arrange the release of coal reserves, and strengthen the supervision of medium and long-term contract performance.
Although the coal market price has rebounded recently, it is mainly due to the increase in market coal quotations outside of medium and long-term contracts, and the transaction volume is relatively small. From the perspective of reasons, this is mainly affected by factors such as the expected increase in energy demand during the peak summer period and the suspension of production in some coal mines.
The temperature rises this summer and the economic situation continues to improve. The demand for electricity continues to grow at a relatively high rate. However, the market expects that coal power consumption will continue to grow due to the lack of water in the previous year. In addition, due to multiple safety accidents in China, more Ground safety inspections have caused coal mines to stop and reduce production in some areas, and have also restricted supply growth on the supply side.
The National Development and Reform Commission pointed out that under the influence of multiple factors, individual coal traders took the opportunity to raise their quotations, which helped boost the market’s bullish sentiment.
In the first quarter of this year, benefiting from the rapid rebound of the domestic downstream market, the prices of coal and related products increased simultaneously, and the performance of coal enterprises increased significantly.
According to data released by the China Coal Industry Association, in the first quarter of this year, 4267 coal enterprises above designated size nationwide had revenue of 562.11 billion yuan, a year-on-year increase of 29.6%; total profits (after subsidies) were 80.88 billion yuan, a year-on-year increase of 94.3%.
In the first half of the year, coal supply and demand were tight, and the coal price center also moved upward. The overall price level was at a relatively high level year-on-year, which also brought performance growth to coal companies. The performance growth of listed coal companies in the first half of the year was in line with market expectations.
June 24,Meijin Energy(000723.SZ) is the first to announce its 2021 semi-annual results forecast. According to the announcement, benefiting from the high prices of coal and coke, and the commissioning of all the company’s new projects, the company’s profit in the first half of the year is expected to be 1.1 to 1.5 billion yuan, a year-on-year increase of 1617.52%-2242.07%.
Development and Reform Commission expects coal prices to fall in July
Starting in November last year, coal prices began to rise slowly, and fell slightly in January this year.
Since March this year, along with economic recovery, loose liquidity, mismatch of supply and demand, the bulk commodity market has opened an upward channel, and coal prices have also risen simultaneously. In the domestic market, the economy has accelerated recovery, market supply and demand are booming, and coal prices have continued to rise. High fluctuations.
Beginning in mid-May this year, many regulatory agencies have made strong voices to deter the market hype atmosphere, and bulk commodities have started a rapid decline. However, since the end of May, coal prices have oscillated again and climbed to a higher range in the same period in history.
On June 24, the main thermal coal contract rose by over 860 yuan/ton, and the coking coal reached a maximum of 2070 yuan/ton. Faced with coal prices that have risen to historical highs, market fears are already brewing, and the National Development and Reform Commission is concerned about short-term coal prices falling. The pre-judgment of the market has “cooled down” the market.
The National Development and Reform Commission stated that with the summer hydropower,Solar energyWith the increase in power generation and the increase in coal production and imports, the contradiction between coal supply and demand will also tend to ease. It is expected that coal prices will enter a downward channel in July, and prices will also drop significantly.
According to the National Development and Reform Commission, coal mines in major coal-producing areas will gradually resume production. It is expected that the production level in early June will be restored by early July. Some high-quality advanced production capacity with the potential to increase production will be gradually released in the second half of the year; in addition, according to imported coal In terms of orders, July and August will be the peak period for the arrival of imported coal, and coal supply will be further effectively supplemented.
After entering the flood season, the incoming water has increased significantly, and the output of hydropower has increased significantly. At the same time, solar power generation has also grown rapidly in summer, which will replace thermal power generation in large quantities and effectively reduce the demand for coal for thermal power.
The current factors affecting the price trend of thermal coal are mainly changes in policies and fundamentals. After July, the production area increase plan and landing situation need to be paid attention to.
The fundamentals of supply and demand are still adjusting
From the current point of view, the tight supply situation in the coal market has not changed significantly.
Shanghai Steel UnionThermal coal analyst Jenny told the 21st Century Business Herald reporter that due to the recent impact of coal mine accidents and safety inspections, and near the end of the month, some coal mines have been suspended for maintenance due to insufficient coal pipe tickets, resulting in a decline in coal mine output.
As the economic situation continues to improve and the summer temperature rises, downstream power demand continues to increase, the state of high-consumption inventory in power plants continues, and the demand for terminal replenishment of inventories continues; however, under the constraints of high coal prices, power plants are actively replenishing inventory. Lower.
Relevant persons in the building materials industry told the 21st Century Business Herald that it has entered the traditional off-season of cement, and the overall cement price is falling. However, under the support of demand and cost, the price of cement clinker in East China and South China is relatively limited; The demand for thermal coal is relatively stable, coupled with the overall limited demand in the cement industry, it is difficult for the thermal coal market to have a greater impact on the whole.
Industrial SecuritiesIt is pointed out that the coal mine shutdown inspection work carried out in various places is expected to continue until early July. In the short term, coal supply will meet stage pressure again; in terms of demand, the daily consumption of thermal coal has returned to the seasonal normal level, but facing the upcoming summer peak power consumption , The inventory is still insufficient, and coal prices are expected to remain strong in the short term.
Wang Guoqing, director of the Lange Steel Network and Railway Research Center, said that the current steel market has entered the off-season, but recently steel production in Tangshan and Handan has been restricted again, and the demand for coke and coking coal has weakened; but currently affected by domestic environmental protection policies, Shandong Some coking companies in Shanxi, Shanxi and other places have restricted production, and coke production in related areas has also been suppressed.
At the same time, with the advancement of the supervision department on the safety production inspection of the coal industry, the supply of coking coal has also shown a tight trend, driving the price of coke to firm.
“Under the expectation of a tight supply of coking coal and coke in the later stage, although steel companies limit production in some areas, the overall steel mills are still more enthusiastic about purchasing.” Wang Guoqing said.
Massive information, accurate interpretation, all in Sina Finance APP
Editor in charge: Wang Shanshan
.