From January 4th to 7th, 2022, the overall performance of coal-related futures varieties is relatively strong. Among them, the weekly price of the main thermal coal ZC2205 contract increased by 6.29%, the coking coal J2205 contract increased by 8.7%, and the coking coal JM2205 contract increased by 2.98%. The overall strength of coal may be related to Indonesia’s sudden announcement during New Year’s Day that it will stop coal exports in January this year in order to ease the country’s coal shortage and possible power shortage. Indonesia is currently my country’s largest source of coal imports. Affected by the expected reduction in coal imports, the domestic coal market sentiment has been boosted. The three major coal varieties (thermal coal, coking coal, and coke) on the first day of the New Year’s opening all jumped higher. Performance. In addition, for coke, the recent expectation of steel mills to resume production has gradually been fulfilled. Affected by the recovery of demand and the factors of winter storage, coke has become the “leader” of the coal market.
Specifically, Indonesia’s suspension of coal exports in January this year will have a certain impact on the domestic coal market, but the impact may be relatively limited. In terms of coal types, most of the coal imported from Indonesia is thermal coal, and coking coal accounts for only about 1%, so it has little impact on the domestic supply of coking coal; for thermal coal, the domestic coal supply guarantee is still implemented. At present, the daily output and inventory of coal are at a relatively high level, and the overall impact of the import shrinkage on the domestic market may be limited. As of January 10, 2022, the Indonesian government has not made a final decision on lifting the ban on coal exports, and the policy is still uncertain, which needs to be paid attention to in the near future.
From the perspective of coke fundamentals, both the supply and demand sides of coke have shown a gradual recovery recently, and the overall inventory fluctuated at a low level.
In terms of profit, the spot price of coke has been rising continuously recently, and the profit per ton of coke has continued to expand. The operating rate of downstream steel mills rebounded, and the purchasing demand for coke increased. In addition, some coke companies also stated that the transportation of raw coal has been hindered recently due to the impact of the new crown pneumonia epidemic. In addition, as the Spring Festival is approaching, there is a large supply gap of raw coal, and prices have risen in varying degrees. The recovery in demand and the rise in coking costs have greatly enhanced the confidence of coke companies. As of January 10, 2022, mainstream coke companies have raised the ex-factory price of coke for 3 rounds, with a cumulative increase of 500 yuan/ton to 520 yuan/ton. In addition, according to the research of relevant institutions, the price of coke by-products has also risen to a certain extent recently, which has made the average profit per ton of coke significantly improved. Last week’s survey data showed that (from January 3rd to 7th), the national average profit per ton of coke was 203 yuan, an increase of 145 yuan from the previous week; among them, the profit per ton of coke in Shandong and Jiangsu provinces exceeded 350 yuan.
With the expansion of profit per ton of coke, the overall production enthusiasm of coke enterprises has increased. Data from last week (January 3 to 7) showed that the capacity utilization rate of independent coke enterprises nationwide rose slightly to 71.6%, up 1.59 percentage points from the previous week, up 4.41 percentage points from the previous low, and down 17.68 percentage points year-on-year. At present, the environmental protection production restriction policy of the coking industry has not changed significantly compared with the previous period, and the coking capacity utilization rate is still in the historically low range. Near the opening of the Beijing Winter Olympics, the overall environmental protection and production restriction policies in Beijing-Tianjin-Hebei and surrounding areas may not be significantly relaxed, and the coking industry is expected to maintain a relatively low operating rate.
In terms of demand, steel mills in some areas have recently accelerated the resumption of production. Last week’s survey data (from January 3 to 7) showed that the average daily hot metal production of 247 steel mills increased to 2.085 million tons, a cumulative increase of 95,000 tons in the past two weeks. , a year-on-year decrease of 357,600 tons. According to previous research by relevant institutions, from December 24, 2021 to the end of January 2022, 49 blast furnaces will resume production, with a production capacity of about 170,000 tons/day, and 10 blast furnaces are planned to be shut down for maintenance, with a production capacity of about 60,000 tons/day. If production is suspended and resumed as scheduled, the average daily output in January 2022 is expected to recover to 2.05 million tons to 2.07 million tons. At present, the resumption of production of steel mills is basically in line with expectations. From the perspective of production resumption areas, the production recovery is mainly concentrated in East China, Central China and Northwest China. Most of the northern regions are still restricted by production restrictions, especially the “2+26″ cities will still implement a year-on-year reduction of 30% in crude steel in the first quarter. % policy, the room for further increase in hot metal production in the short term may be limited, and it is still necessary to pay attention to whether the national crude steel output will continue to implement the policy of no increase or decrease year-on-year this year.
In terms of inventory, the overall coke inventory remained low and fluctuated. The resumption of production of steel mills has also been gradually reflected in the coke inventory. At present, the coke inventory of steel mills has not increased significantly, and the available days of inventory have continued to decline to about 15 days, which is in the median and reasonable range. During the period before the Spring Festival, steel mills still have a certain willingness to purchase to maintain a stable supply of raw materials during the Spring Festival. In addition, the recent active purchases by traders have also significantly eased the pressure on the inventory of coking plants. Last week (January 3 to 7), the coke inventory in the coking plant was about 1.11 million tons, down 1.06 million tons from the previous high. The decline in inventory also gave coke companies some room to increase production; while the coke inventory in ports continued to increase, and since 2021 Since November this year, the accumulated storage has exceeded 800,000 tons.
On the whole, the recent resumption of production of steel mills and the recovery of coke demand have become the main driving forces for the strong trend of coke prices. In addition, the strong operation of raw material coking coal prices also supports the cost of coke, and the overall fluctuation of coke prices is strong. It is expected that the coke market is still expected to remain strong in the short term, but further attention should be paid to the resumption of production by steel mills.