Commodity Market Report
China coal short-term outlook August 2022
Report summary
The QHD price used to fall in August as the summer peak demand period ended. However, it did not happen this year. The QHD price increased roughly RMB50/t in the last two weeks of the month. Heavy rainfalls, scorching weather and Covid infections in key mining areas were the major issues for the unusual trend in thermal coal prices. We expect the price to remain at high levels in September. The domestic coking coal price gained support from a recovered appetite from downstream consumers. At the same time, the short-lived overhauling of blast furnaces encouraged the rapid resumption of steel mills. However, we didn’t witness a substantial demand awakening of steel in August, and the prospect for September is equally dim. What can we expect?
Table of contents
- Thermal: extreme heat offsets weak demand by industries
- Met: blast furnaces resuming operations ensured coal demand but the risk is still at the door
- Heavy rainfalls and safety inspections constrained domestic production in July
- Supply tightens amid several interventions in August
- Thermal import: low energy seaborne coal is now cheaper in China
- Met import: annual highs from Mongolia and Russia
- Thermal: weather continued to underpin the QHD price
- The QHD price will continue to fluctuate in September
- Met: temporary price upticks can’t conceal the high probability of further demand weaknesses
Tables and charts
This report includes 13 images and tables including:
- BF capacity utilisation rates (%)
- Coking coal inventory in the mines (Mt)
- Monthly coal-fired power generation (TWh)
- Monthly hydro-power generation (TWh)
- Monthly throughput at Qinhuangdao port (Mt)
- Monthly throughput at Huanghua port (Mt)
- Monthly hot metal production (Mt)
- Monthly metallurgical coke production (Mt)
- China coal output monthly (Mt)
- Thermal coal supply (Mt)
- Metallurgical coal supply (Mt)
- Key thermal coal prices: history and forecast (US$/t)
- Hard coking coal price arbitrage at Tangshan steel mill (US$/t nominal)
What's included
This report contains:
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