China’s coal prices continue to tumble, leaving the import outlook in question.

Singapore: Chinese thermal coal prices fell to a one-year low this week as inventories rose while domestic mining output recovered faster than
demand, analysts, and traders said. The largest consumer of coal in the world has large reserves, which limit its willingness to import and put pressure on the world market prices. 

The slow recovery of China’s coal consumption also points to a gradual recovery of electricity consumption and the world’s second largest
 growth. Analysts predict that China’s coal demand will grow by 2 percent this year as industry and construction recover and fuel demand. on imports, particularly high-quality Australian coal, after China partially relaxed its ban on imports from there.

However, rising inventories at ports and facilities point to a faster recovery in mining output than in downstream industries such as steel, cement, and chemicals, undermining the market. confidence in the near-term demand outlook.
Spot coal prices with a calorific value of 5,500 kilocalories (kcal) at North China ports fell to 980 yuan ($142.9)tonnes this week, a level last seen in early February 2022. 

Australian 5,500 kcal coal fell 10 percent over the past two weeks to cents a tonne, or about $118 a tonne (FOB) of tonnes, while Indonesia’s 3,800 kcal coal fell 17 percent to about $67 a tonne.

“Most coal miners resumed production after the Lunar New Year holiday, but “The downstream sector is recovering more slowly due to weak demand.” Tianfeng Futures analyst Xiao Lanlan said in a note.

Coal inventories at eight northern ports rose to 35.96 million tonnes this week levels last seen in April 2020, when industrial operations were suspended due to COVID-19,

According to data from the China Association of Coal Transportation and Distribution (CCTD),Large companies’ inventories are also higher than they were four years ago but coal consumption by power plants seems to have risen to last year’s level, the data showed.

The building materials market also expects continued economic stimulus from the government to support the infrastructure and real estate sectors analysts and coal traders said.

“We were hoping for both a strong recovery in demand and a quick recovery in the economy after the new year, but it appears that the road to recovery is much slower than expected,” said the utility’s head of coal purchasing, who declined to comment or identify himself because he is not authorized to speak to the media.

Timely supplies from domestic coal miners are more than enough for us, and I see very little scope for imports at present.

Corpradar is a next-gen digital IR 4.0 corporate media house that combines the power of technology with human capital to bring decisive and insight-driven content on key business affairs. In an absolute sense, we create a space for leading business houses and visionary corporate leaders to chime in with their opinions and thoughts on relevant industry-specific matters that provide a detailed expert perspective for our followers.

Leave a Reply

Your email address will not be published. Required fields are marked *