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China coal short-term outlook January 2020: coronavirus increases supply tightness

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12 February 2020

China coal short-term outlook January 2020: coronavirus increases supply tightness

Report summary

The price for Qinhuangdao 5,500 edged up to RMB566/t in January with inventory low at northern loading ports. Delivery costs higher than coal prices, safety inspections and snowstorms were behind the dwindling stockpiles. On the metallurgical side, high margins on steel products continued to encourage steelmakers to maintain high operating rates. The traditional restocking in the run-up to the Chinese new year holiday supported the price at RMB1,470/t on a Liulin #4 FOR basis, with the absence of effective imported coal supply. We expect the low inventory and tight supply in ports will persist in February as the coronavirus outbreak has disturbed domestic coal production. Measures introduced to contain the spread of infection will have a greater impact on supply than on demand. The QHD price will increase to RMB580/t or even higher, while Liulin #4 will climb to RMB1,490/t on a FOR basis.

Table of contents

  • Low port inventory underpins prices in the near term
  • Coronavirus outbreak will keep QHD price above RMB580/t in February
  • Coronavirus outbreak harms domestic coking coal supply but will support prices
  • How will the coronavirus outbreak impact thermal coal demand in February?
  • Steel and metallurgical coal demand also affected in the short run
  • NBS reports total coal production at 37.5 Bt in 2019
  • Domestic output impacted by the coronavirus

Tables and charts

This report includes 10 images and tables including:

  • Key thermal coal prices: history and forecast (US$/t)
  • Hard coking coal price arbitrage at Tangshan steel mill (US$/t nominal)
  • 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)
  • Thermal coal supply (Mt)
  • Metallurgical coal supply (Mt)

What's included

This report contains:

  • Document

    cms-china-short-term-market-report-data.xlsx

    XLSX 434.29 KB

  • Document

    China coal short-term outlook January 2020: coronavirus increases supply tightness

    PDF 1.03 MB

  • Document

    China coal short-term outlook January 2020: coronavirus increases supply tightness

    ZIP 1.32 MB

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