China coal short-term outlook December 2023

Weather was the key issue in the thermal coal market, which supported coal prices in December. The recorded cold temperatures in many areas led to price increases in the middle of the month. However, the QHD price rebounded only RMB25/tonne due to the short-lived coldness and then reversed to fall till the end of the year. We expect coal prices to sustain the downtrend in January if the weather remains normal as the Chinese New Year holiday approaches. The snow coming with the Siberian cold front brought obstacles to the mines in the mountainous areas, with road hauling being suspended for around a week. New mine accidents followed the previous ones and more safety checks loaded. Prices borrowed support from the supply side despite actual demand dropping; after rapidly surging, the hint of further weakening emerged at the corner of the street. What will change coming into the new year? What will be the biggest price drivers in the short run? Read our report to find the answers.