Sxcoal Issue #6 | Latest weekly survey on China's thermal and coking coal
China is soon to start its grandest Lunar New Year celebrations. This has produced visible impact on domestic coal market. More reports emerged on China's lifting of import ban on Australian coal.
Sxcoal’s latest weekly survey on China’s coal mines showed slightly varied impact of the Lunar New Year effect, i.e. relatively smaller to thermal coal than coking coal, partially reflecting their current stucture of operation.
Thermal coal
Despite early holiday leave of some small- and mid-sized mines, the recovery of some other mid- and large-mines after maintenance during the New Year and reduced COVID infections among workers helped enhance the overall operation at mines in major production areas.
Over the week ending Jan 11, capacity utilization of the 100 thermal coal mines surveyed by Sxcoal in Shanxi, Shaanxi and Inner Mongolia climbed by 1.22 pps WoW to 88.56%. These coal mines have a combined capacity of 636.7 Mtpa.
While a small part of previously high-priced mines lowered prices to destock, prices of some premium high-CV coal ticked up in the wake of improved sales and higher buying prices of CHN Energy for third-party coal. Still, 80% of the mines kept prices unchanged from the week prior.
Coking coal
By contrast, the overall capacity utilization of coking coal mines surveyed by Sxcoal dipped by 0.23 pp WoW to 86.89% in the week ending Jan 12, as small local mines gradually entered holidays for the Spring Festival, despite recovered production at large mines.
Coking coal miners further lowered prices, and the declines extended to more coal grades and a wider area, owing to sluggish sales amid slidelined coke makers. Of the Sxcoal-surveyed mines, 25 mines cut prices by 78 yuan/t averagely.
Accordingly, stockiples further climbed at these mines, as coke makers generally finished winter restocking. Increased losses after 2nd drop in coke prices also reduced purchase interests.
The above are just a brief summary of our weekly survey for China's coal sector. More granularized datasets down to each of the mines surveyed are available in EXCEL spreadsheets sent to subscribers via email each Thursday.
If you wish to learn more details, pls kindly sign up at HERE or reply to this email.
More on Australian coal
More signs emerged in the market have reinforced our belief that China has allowed the import of Australian coal into the country. Trade sources disclosed regional customs in southeastern China’s Guangdong would process declaration of Australian coal with no more restrictions. This has negatively impacted sentiment in both China’s domestic and seaborne import markets.
China’s domestic thermal coal prices softened on expected inflow of Australian coal, given the current price edge of Austrlian coal over Chinese domestic coal. »More details
Offers and bids emerged for Australian coal in China's seaborne import market, as traders joined the purchase after state-run groups. Indonesian coal thus declined amid muted inquires. »More details
We kept a close track of the market and publish the latest developments on our website and in the CCI Daily newsletter (download the latest issue). If you wish to take a trial of either the web version or the newsletter, pls sign up HERE or reply to this email directly.