China Electric Power Co., Ltd. releases | The off-season characteristics of electric coal are highlighted, and the spot market is weak and stable

The "CECI Index Analysis Weekly Report" (Issue 40, 2024) released by the Preparation Office of China Electric Coal Purchasing Price Index (CECI) shows that this issue (2024.10.24-2024.11.1) CECI Caofeidian Index fell slightly. The spot transaction prices of medium and high cards in the coastal index continued to drop slightly. The import index continued to rise slightly overall. The CECI Purchasing Managers Index is in the contraction range for four consecutive periods. In the sub-index, the supply, inventory and shipping sub-index are in the expansion range, the price sub-index is in the contraction range, and the demand sub-index is in the balance point of prosperity and drought. Except for the shipping sub-index, the other sub-indexes are all rising month-on-month.

1. Market situation summary

In this period, power generation, coal consumption and coal inputs in the factory increased month-on-month, heat supply continued to increase, and inventory continued to grow rapidly month-on-month. According to the China Electric Power Union fuel statistics, the average daily power generation of coal-fired power plants of coal-fired power plants included in the fuel statistics of the power industry in this period increased by 4.4% month-on-month and a year-on-year decrease of 0.5%. The average daily heating capacity increased by 12.1% month-on-month and 35.6% year-on-year. The average daily electricity and coal consumption increased by 4.6% month-on-month and decreased by 0.1% year-on-year. Among them, the average daily coal consumption of sea-road power plants decreased by 2.7% month-on-month and 1.8% year-on-year; the average daily coal consumption of coal entering the plant increased by 2.8% month-on-month and 3.0% year-on-year. Coal-fired power plants have 125.44 million tons of coal inventories, up from 6.87 million tons in the same period last year.

In terms of the main domestic coal production areas, most coal mines maintain normal production and sales, and large state-owned mines give priority to ensuring long-term cooperation delivery and internal supply. Some private coal mines have begun to suspend production and maintenance due to the completion of production tasks at the end of the month. Some open-pit coal mines have been restricted due to the impact of rainfall, and the overall supply of coal in the market has slightly contracted. The northeast and northwest regions have successively started heating, and the daily coal consumption of power plants has increased slightly, and the sales prices of a few coal mines have risen slightly. However, power plant inventory is high, actual demand increase is limited, coal prices are underrepresented, and the overall pit market price remains fluctuating in a narrow range. In terms of the port market, the Daqin Line has been repaired and full shipping has been resumed. A large amount of imported coal has been cleared to the shore. In addition, the demand for power plants is weak, the overall supply and demand of the spot market is still loose. The continued rising inventory and sluggish demand continue to significantly suppress market sentiment, but shipping cost support and some traders still have expectations for winter demand. The transaction prices in the spot market remained stable during a stalemate and fell slightly.

Overall, the supply of the main coal production areas has contracted slightly, the actual demand of power plants is limited, and the support for the rise in coal prices is insufficient. The market price of pit outlets has maintained a narrow range of fluctuations. The activity of trading in the port spot market continues to cool down, and the port spot transaction prices are weak and stable.

2. CECI index analysis

The spot transaction prices of CECI Coastal Index 5,500 kcal/kg and 5,000 kcal/kg decreased by 3 yuan/ton and 2 yuan/ton respectively compared with the previous period. Judging from the sample situation, the sample price ranges of 5,500 kcal/kg and 5,000 kcal/kg specifications are 851-858 yuan/ton and 753-760 yuan/ton respectively. Judging from the sample calorific value distribution, the 4500 kcal/kg, 5000 kcal/kg and 5500 kcal/kg samples accounted for 32.7%, 52.7% and 14.6% of the total amount, respectively.

The average prices of CECI Caofeidian Index on November 1st were 856 yuan/ton, 756.4 yuan/ton and 664.8 yuan/ton respectively. The spot price of electric coal fell slightly, and the average prices of each specification rose by 0 yuan/ton, 0.2 yuan/ton and 0.2 yuan/ton respectively compared with last week. The average daily number of spot trading decreased slightly compared with the previous period, with the number of samples of 5,500 kcal/kg increased, while the number of samples of 5,000 kcal/kg and 4,500 kcal/kg decreased.

The unit price of the CECI import index landed standard coal was 979 yuan/ton, up 19 yuan/ton from the previous period and 2.0% month-on-month. Among them, the prices of 4,600 kcal/kg and 3,800 kcal/kg rose by 13 yuan/ton and 12 yuan/ton respectively compared with the previous period. The procurement time for imported coal samples in this period was concentrated in late October, and the imported coal market was stable and strong, and the overall price rose slightly.

CECI Purchasing Managers Index is 49.82%, and it is in the contraction range for four consecutive periods, up 0.31 percentage points month-on-month. Among them, the supply index was 51.59%, up 0.02 percentage points month-on-month, and was in the expansion range, indicating that the supply of electricity and coal continued to increase and the growth rate expanded. The demand sub-index was 50.00%, up 1.04 percentage points month-on-month, and was at the balance point of prosperity and drought, indicating that the demand for power coal remained unchanged month-on-month. The inventory sub-index was 52.41%, up 1.99 percentage points month-on-month, and was in the expansion range for five consecutive periods, indicating that the inventory of electricity and coal continued to increase and the growth rate expanded. The price sub-index was 47.79%, up 0.81 percentage points month-on-month, and was in the contraction range for four consecutive periods, indicating that the price of electric coal continued to decline and the decline narrowed. The shipping sub-index was 51.05%, down 1.07 percentage points month-on-month, and was in the expansion range for two consecutive periods, indicating that the price of electric coal shipping continues to increase and the growth rate has narrowed.

3. Relevant information and suggestions

According to the monitoring and summary data of the Office of the Leading Group for Logistics and Safety Protection and Smoothness of the State Council, from October 21 to October 27, the national freight logistics was operated in an orderly manner, including: the national railway transported a total of 80.182 million tons of goods, an increase of 1.35% month-on-month; the national expressways had a total of 57.071 million trucks, an increase of 1.85% month-on-month.

According to data from the National Energy Administration, as of the end of September 2024, the national renewable energy installed capacity reached 1.73 billion kilowatts, a year-on-year increase of 25%, accounting for about 54.7% of my country's total installed capacity. The power generation of renewable energy has steadily increased. In the first three quarters of this year, the national renewable energy generation reached 2.51 trillion kilowatt-hours, an increase of 20.9% year-on-year, accounting for about 35.5% of the total power generation.

According to the fuel statistics of China Electric Power Industry in the Electric Power Industry, as of October 31, the cumulative power generation of coal-fired power plants of the power generation group included in the fuel statistics of the power industry increased by 1.1% year-on-year, and the cumulative power generation this year increased by 1% year-on-year. The coal consumption of coal-fired power plants increased by 1.3% year-on-year this month and decreased by 0.4% year-on-year this year. Coal inventory in coal-fired power plants was higher than 6.87 million tons in the same period last year, and the number of days available in stocks increased by 1.2 days compared with the same period last year.

China Electric Power United released the "National Power Supply and Demand Situation Analysis and Forecast Report for the Third Quarter of 2024", which is expected that the national and social electricity consumption will increase by about 5% year-on-year in the fourth quarter of this year, and the growth rate of the whole society's electricity consumption in 2024 will exceed 2023. At present, the overall national power coal inventory is at a high level, providing a good supply guarantee foundation for this year's peak winter. Taking into account the growth in demand, power supply and power supply, the supply of electricity and coal and natural gas is expected to be tightly balanced during this year's peak winter.

The China Meteorological Administration predicts that this winter (December 2024 to February 2025), the temperature in most parts of the country will be higher than the same period in the previous year, but the temperature fluctuates significantly during the season, and there is a high possibility of process-induced heavy cooling. In winter, there may be phased heavy cooling and heavy snowfall in central and northern Northeast China, most of Inner Mongolia, central and eastern Northwest China, northern Xinjiang and other places.

After the fall centralized maintenance of the Daqin Line, the average daily transportation volume quickly increased to about 1.3 million tons. Recently, the coal used for civilians and chemicals has maintained regular procurement, the power plant load is not high, spot procurement demand is sluggish, port inquiry demand is weak, and inventory in the Bohai Rim port continues to accumulate. The inventory of power enterprises is running at a high level, coupled with the stable cashing of long-term coal and imported coal. Therefore, before the peak season for coal consumption, market supply is more relaxed, and short-term prices are still likely to weaken, but with the support of shipping costs and expectations of warmer macroeconomics, the decline space will be limited. Based on comprehensive judgment, market prices will continue to have a stable and weak trend in the short term. It is recommended to actively connect with the medium- and long-term contract agreements in 2025, strive to sign and implement medium- and long-term contracts, and increase the proportion of high-quality long-term contract contracts.