Commodity market report
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8 Pages

China coal short-term outlook May 2016

China coal short-term outlook May 2016

Report summary

The supply-side reforms are having a positive effect on domestic coal prices. Benchmark thermal coal prices remained flat in May despite going into shoulder season while hard coking coal prices increased RMB 54/t in May from average levels in April. Strict mine safety inspections and tighter production controls have helped rationalise production; and the provisional statistics suggest the output declined 7% year-on-year in Jan-April.

The pricing stance shown by key miners in 2016 indicate that they are now keen to chase margins than volume growth, which has been the main feature over the past few years. However, demand remains very weak and it could fall further in the near-term undermining the supply discipline displayed so far in 2016.
We forecast seaborne thermal and metallurgical coal imports to reach 125 Mt and 45 Mt, respectively, in 2016. Key domestic prices will likely range-bound RMB380-400/t FOB Qinhuangdao for thermal coal and RMB600-650/t CFR North China for hard coking coal.

What's included?

This report includes 2 file(s)

  • China coal short-term outlook May 2016 PDF - 395.40 KB 8 Pages, 1 Tables, 12 Figures
  • cms china short term market report data.xls XLS - 1.73 MB


Global coal markets are facing extraordinary challenges and uncertainties. Factors such as global overcapacity, weakening demand and falling prices have created cautious investors. These factors have caused delays and cancellations of many mine and infrastructure projects, as well as lower growth rates at others.

This Thermal Coal Market Short Term Outlook report gives global and regional coal producers, consumers, transporters and investors detailed supply, demand and price forecasts for the coal industry, covering all the key domestic markets in North America, China and India.

Use this report to gain a better understanding of market dynamics, including revenue and demand potential for different coals. It will also help you identify trade patterns and changes affecting the thermal coal markets.

Wood Mackenzie is the only coal industry service provider that offers a market outlook integrated with other sector analyses, including macroeconomics, coal supply, steel markets and gas and power markets. Our coal analysts are based in the markets they analyse. They work with objective, proprietary data to help you maximise your current and future investments.

From market dynamics to trade patterns, we give you confidence in your strategic planning.

  • Executive summary
  • Prices
  • Demand
    • Thermal coal outlook bleak in the face of surging hydropower
    • Strong H1 metallurgical coal demand may not last in H2
  • Supply
    • Domestic supply remains tight as China steps up production controls
    • Year-to-date April seaborne imports fell 4%; metallurgical coal imports gained 2%
    • Is thermal coal export the answer to overcapacity problem in China?

In this report there are 13 tables or charts, including:

  • Executive summary
    • Key market data
  • Prices
    • Key thermal coal prices - history and forecast, US$/t nominal
    • Hard coking coal price arbitrage at a steel mill in Tangshan, US$/t nominal
  • Demand
    • Monthly coal-fired 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
    • Real-estate starts, completions and sales, year-on-year change, %
  • Supply
    • Thermal coal supply - history and forecast, Mt
    • Metallurgical coal supply - history and forecast, Mt
    • Chinese thermal coal exports by destination, Mt
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