crashteamracingps3download| Coal mining industry weekly report: Coal prices are stabilizing and recovering, and are still rising, and supply and demand fundamentals continue to improve

The price of coal in the producing area rose month-on-month this week. As of May 10, the pit entrance price of power lump coal (Q6000) in Yulin, Shaanxi Province was 840.0 yuan / ton, up 30.0 yuan / ton compared with the previous week; the car plate price of Dongsheng bulk clean coal in Inner Mongolia (Q5500) was 682.5 yuan / ton, up 20.0 yuan / ton compared with the previous week; and the sticky coal pit price (including tax) (Q5500) in the southern suburbs of Datong was 720.0 yuan / ton, up 35.0 yuan / ton. The daily consumption of power coal in the interior decreased compared with the previous year. As of May 10, 6033 trains arrived at Qinhuangdao Port this week.Crashteamracingps3downloadThe port of Qinhuangdao handled 359000 tons, down 41.34% from the previous week. The average weekly inventory level of major domestic ports (Qinhuangdao, Caofeidian, and Guotou Jingtang Port) was 11.28 million tons, down 20000 tons from 11.3 million tons last week, and 0.18 percent lower than the previous week. As of May 9, coal stocks in 17 inland provinces increased by 1.519 million tons compared with last week, an increase of 2.05% compared with the previous week; daily consumption decreased by 20.4 million tons per day compared with last week, down 6.47% from last week; and available days increased by 2.60 days over last week. Port thermal coal prices increased month-on-month. Port thermal coal: as of May 9, Qinhuangdao port thermal coal (Q5500) Shanxi production market price of 849.0 yuan / ton, up 22.0 yuan / ton compared with the previous week. As of May 9, the spot price of Newcastle NEWC5500 kcal thermal coal FOB is US $91.30 / ton, up US $2.10 / tonne; the spot price of ARA6000 Kaka thermal coal is US $110.1 / tonne, up US $7.10 / tonne; and the spot price of FOB thermal coal in Richards Port is US $90.10 / tonne, down US $1.00 / tonne. Coke: Coke steel temporarily stable operation, five rounds of upward trend weakened. Producing area index: as of May 10, 2024, Fen Wei CCI Luliang quasi-first-class metallurgical coke reported 1910 yuan / ton, with a flat weekly ratio. Port index: CCI Rizhao quasi-first-class metallurgical coke reported 2000 yuan / ton, down 50 yuan / ton from the previous week. Generally speaking, the coke market is stable and strong, and coke began to rise for five rounds this week, but due to the steel coke game, the rise has not yet landed; with the overall downward movement of the black disk, the steel price and trading volume have declined, and the profit margins of steel mills have been compressed. Some steel mills are more resistant to five rounds of increases, but recently, the overall inventory of steel mills is low, and the demand for replenishment is OK, which affects the smooth delivery of coke enterprises. On the whole, coke supply continues to rise, supply and demand pattern is tight balance, later need to pay attention to steel prices and transaction performance. Coking coal: downstream procurement mentality is cautious, coal prices as a whole temporarily stable. As of May 10, the CCI Shanxi low sulfur index was 2046 yuan / ton, which was the same as the day-to-month ratio; the CCI Shanxi high-sulfur index was 1812 yuan / ton, which was the same as the day-to-month index; and the Lingshi fat coal index was 1900 yuan / ton, which was the same as the day-to-month index. Although the supply of the producing area has continued to recover since May, there are still coal mines in the main producing areas that have stopped or limited production due to accidents or their own reasons, and the overall supply has not yet returned to the level of the same period last year. The black system continues to decline, the terminal has a certain resistance to the five-round rise of coke, the wait-and-see mood at the raw material end increases, the newly signed orders for high-priced resources are not good, and some coal mine inventories have accumulated slightly, but most coal mines have pre-orders still pulling. There is no inventory pressure for the time being, superimposed downstream coke steel enterprises continue to pick up, raw materials still have some support, short-term or partial stable operation is the main.Crashteamracingps3downloadWe believe that the current coal economy is in the early stage of a new cycle of upward, fundamentals, policy resonance, at this stage bargain allocation of coal plate at the right time. On the supply side, the utilization rate of capacity in the three provinces of Shanxi, Shaanxi and Inner Mongolia was 82.5%, down 0.1 percentage points from the previous month, and the supply side as a whole remained stable. It should be noted that from April to May, the security inspection of coal mines is still strong, and Shanxi Province is in the period of "looking back" from April 1 to May 31, when helping and guiding production safety. Shanxi Province also issued a supplementary notice on carrying out coal mine "three super" and special rectification of concealed working face, extending the renovation time to the end of December 2024. In mid-April, Shaanxi Province began to launch the "big start and bottom" action to rectify the hidden dangers of major accidents in production safety, which was divided into three stages: self-examination and self-improvement, special inspection, and accountability, and ended at the end of September. At the same time, other major coal-producing provinces have carried out special safety supervision actions, and we expect that under the high pressure of safety supervision, the coal supply of major producing areas in May-June or even for the whole year will maintain negative growth or decline in growth rate compared with the same period last year. On the demand side, the daily consumption of 17 inland provinces and eight coastal provinces decreased (the daily consumption of inland 17 provinces decreased by 204000 tons per day compared with last week, and that of eight coastal provinces decreased by 24 million tons per day compared with last week). In terms of non-electricity demand, the weekly coal consumption of the chemical industry dropped by 4.08 million tons per day compared with last week, 0.65 percent lower than the previous week, and remained high compared with the same period last year. Coke started its fifth round of growth this week, but the increase in steel coke game has not yet landed. In view of the recent increase in production by coke and steel enterprises, short-term demand has certain support (as of May 10, the national blast furnace operating rate was 81.5%, an increase of 0.90% compared with the previous week). In terms of prices, coal prices continued to rise this week, with a rebound higher than last week (as of May 9, Qinhuangdao port thermal coal (Q5500) Shanxi production market price 849 yuan / ton, up 22 yuan / ton compared with the previous week; Jingtang port Shanxi main coking coal warehouse price (including tax) 2200 yuan / ton, weekly ring up 50 yuan / ton). It is worth noting that overseas countries such as India and Vietnam have strong demand for coal (India's coal imports totaled 65.51 million tons from January to March of 2024, an increase of 24.1 percent over the same period last year; from January to April of 2024, Vietnam imported 20.5688 million tons of coal, an increase of 72.3 percent over the same period last year). Superimposed by the impact of a new round of warming of the geopolitical situation in the Middle East, coal prices on the international market soared to US $150 / ton. On the whole, with the resumption of production downstream, especially the resumption of suspended infrastructure projects, non-electricity demand is expected to gradually improve, and domestic coal supply shrinks under the continuous constraints of safety regulation (January to April of 24 years. National raw coal production fell 4.1% year-on-year) and imported coal reduction caused by high overseas coal prices In particular, the shortage of spot volume and inventory is not obvious and even coking coal inventory is at a relatively low level in the same period, we expect short-term coal prices to show a small fluctuation but the amplitude narrows, but once entering the early summer peak, the power plant takes the initiative to replenish the warehouse (June-July) and non-electricity demand continues to improve marginally (August-September), thermal coal prices still have upward momentum and greater upward elasticity, coking coal prices are expected to rebound more strongly. At the same time, we believe that coal supply and demand at both ends of the supply is the most critical, supply is inelastic and demand is elastic, the main contradiction is whether the demand can realize a significant recovery. At present, to look at the normal fluctuations of coal prices in the off-peak season objectively, we do not need to pay too much attention to the short-term price correction, but should pay more attention to the fact that the annual price center is expected to be at a relatively high level, which determines that high-quality coal enterprises are still expected to maintain a high level of ROE. Based on this, we believe that the downward pullback of the coal sector is supported by a high dividend margin, the upward elasticity is catalyzed by the subsequent rise in coal prices, and the superposition is accompanied by the confirmation of the bottom of the coal price, which brings valuation remodeling and has more room for improvement. it is recommended to pay attention to the bottom layout opportunities at this stage. On the whole, under the background of high energy inflation, we believe that the tight pattern of coal supply and demand in the next 3-5 years remains unchanged, and high-quality coal enterprises still have the attributes of high barriers, high cash, high dividends and high dividends. Superimposed coal prices bottom to promote the reshaping of plate valuation, plate investment is both offensive and defensive and has a high performance-to-price ratio, and the high investment value has been highlighted after the short-term correction. Once again, it is suggested to focus on seizing the opportunity of coal allocation at the present stage. Investment suggestion: combined with our research and judgment on the cycle of energy production, we believe that under the situation of increasing coal production and ensuring supply throughout the country, the tight coal supply may continue throughout the "14th five-year Plan" or even the "15th five-year Plan". It may be necessary to plan and build a number of high-quality production capacity to ensure China's medium-and long-term energy and coal demand. Under the background of the accelerated westward shift of coal layout and the substantial increase in resource fees and per ton coal investment, the rise in the rigid cost of economic development is expected to support the coal price center to remain high, and the asset injection of superimposed coal central state-owned enterprises has already started. it increasingly highlights the high certainty of the profitability and growth of high-quality coal companies. At present, the coal sector has the attributes of high performance, high cash, high dividend, high prosperity, long cycle and high barriers, as well as undervalued level and first-and second-level valuation upside down. We continue to look at the coal sector in an all-round way and continue to suggest that we pay attention to the historic opportunities for coal allocation. From the bottom up, focus on: first, Yanzhou Mining Energy, Guanghui Energy, Shaanxi Coal Industry, Shanxi Coal International, Shanxi Coal Industry, etc., which have large room for endogenous and epitaxial growth, Guanghui Energy, Shanxi Coal Industry, etc.; second, promoted by the central reform policy, the central coal enterprises with large room for asset value revaluation, Shenhua, China Coal Energy, Xinji Energy, etc. Third, high-quality metallurgical coal companies with special scarcity of global resources, such as Ping Coal, Huaibei Mining, Shanxi Coking Coal, Lu'an Huaneng, Panjiang, and so on; fourth, it is suggested to pay attention to the related targets of anthracite that can be used as metallurgical injection coal, such as Orchid Kechuang and Huayang shares, as well as the related opportunities in the field of coal production and construction under the new round of production cycle, such as Tiandi Science and Technology, Tianma Intelligence Control, etc. Risk factors: coal mine safety accidents occur in key companies; downstream energy consumption departments continue to limit production on a large scale; macroeconomic stall drops sharply. [disclaimer] this article only represents the views of a third party and does not represent the position of Hexun. Investors operate accordingly, at their own risk.

[disclaimer] this article only represents the views of a third party and does not represent the position of Hexun. Investors operate accordingly, at their own risk.