Bulks sectors await coronavirus exit strategy: week ended 17th April

China’s official GDP data released on 17th April recorded a 6.8% reduction in Q1, revealing the scale of the economic downturn wrought by the coronavirus outbreak. However, industrial activity remains on the mend with blast furnace utilisation close to 2019 levels in April, and power demand continues to recover. There is some hope that knowing the scale of the impact may be the trigger for targeted stimulus by the Chinese government. Elsewhere there is considerable talk of softening restrictions, a positive sign for demand no doubt. But on the ground there is little improvement to speak of, with demand for steel, iron ore and coal still languishing. India, Europe and the US are still some distance away from sustainable rebounds in activity. Chinese dynamics, and continuing supply tightness, are acting to help iron ore and met coal prices stay healthy. But unfortunately, the same cannot be said for thermal coal.