China Electric Power Co., Ltd. releases | Inventory high and peak season is not strong, spot prices continue to be weak

ChinaElectric coalPurchase price index (CECI) The "CECI Index Analysis Weekly Report" (Issue 45, 2024) released by the Preparation Office shows that this issue (2024.11.28-2024.12.6) CECI Caofeidian Index has declined for five consecutive periods. The spot transaction prices of medium and high cards in the coastal index fell slightly. The import index has a high-card coal type, which has risen slightly. The CECI Purchasing Managers Index is in a contraction range for three consecutive periods. Among the sub-indexes, except for the supply sub-indexes in an expansion range, the other sub-indexes are in a contraction range. The demand and price sub-indexes have increased month-on-month, and the supply, inventory and shipping sub-indexes have decreased month-on-month.

1. Market situation summary

In terms of coal-fired power plants production, affected by strong winds and cooling, snowfall in local areas and other weather, power generation and heating capacity continued to grow rapidly. The consumption of electricity and coal inflows both increased month-on-month, but it was still lower than the same period last year, and inventory continued to rise 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 5.9% month-on-month and a year-on-year decrease of 4.0%. The average daily heating capacity increased by 6.4% month-on-month and 26.2% year-on-year. The average daily electricity and coal consumption increased by 5.7% month-on-month and decreased by 3.4% year-on-year. Among them, the average daily coal consumption of sea-road power plants increased by 5.9% month-on-month, a decrease of 1.6% year-on-year; the average daily coal consumption of coal entering the plant increased by 8.4% month-on-month, a increase of 12.0% year-on-year. Coal inventory in coal-fired power plants was 133.51 million tons, an increase of 12.64 million tons month-on-month.

In terms of the main domestic coal production areas, most coal mines maintained normal production and sales, and the average daily output increased at the beginning of the month, mainly to ensure the Changcheng Coal Coal and shipping stations, and the overall supply was basically stable. At this stage, the temperature in most parts of my country is higher than in previous years. Power plants only maintain urgent demand for procurement. Coal plants and traders around Kengkou are mostly cautious and wait-and-see. In addition, the purchase prices of large coal companies continue to drop, and the number of transport vehicles has decreased significantly. Market coal sales are relatively deserted. The inventory pressure on Kengkou has not eased, and prices continue to fall.

In terms of the port market, the port has been lifted from the closure, the efficiency of loading ships with delayed ports has been improved in the early stage, and the pressure on port storage accumulation has been alleviated. The daily coal consumption of coastal power plants has rebounded seasonally, but with the supplement of the Changcheng coal guarantee and imported coal, inventory continues to accumulate, spot procurement demand is sluggish, actual transaction volume is average, and the spot transaction price of ports continues to decline.

Overall, coal consumption in coal-fired power plants increased month-on-month, and inventory continued to rise. The supply of main coal production areas is stable, and the port transfer volume remains at a medium-to-high level. Due to the continued reduction of the purchase price of large coal companies, and the high inventory of power plants, the spot transaction prices in the pit and port markets continue to operate weakly.

2. CECI index analysis

The spot transaction prices of CECI Coastal Index 5500 kcal/kg and 5000 kcal/kg decreased by 2 yuan/ton and 3 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 820-833 yuan/ton and 719-727 yuan/ton respectively. Judging from the sample calorific value distribution, the 4500 kcal/kg, 5000 kcal/kg and 5500 kcal/kg samples accounted for 38.2%, 44.6% and 17.2% of the total amount, respectively.

The average prices of CECI Caofeidian Index on December 5,500 kcal/kg, 5,000 kcal/kg and 4,500 kcal/kg were 821.8 yuan/ton, 720.8 yuan/ton and 630.4 yuan/ton respectively. The spot price of electric coal continued to decline, and the average prices of various specifications this week decreased by 6.6 yuan/ton, 6.2 yuan/ton and 6.4 yuan/ton respectively compared with last week. The average daily number of spot trading increased slightly, with the number of samples of 5,000 kcal/kg increased, while the number of samples of 5,500 kcal/kg and 4,500 kcal/kg decreased slightly.

The unit price of standard coal onshore in CECI import index was 939 yuan/ton, down 28 yuan/ton from the previous period, down 2.9% month-on-month. Among them, the price of 3800 kcal/kg in Guangzhou Port (Panama) rose by 10 yuan/ton compared with the previous period, mainly because the winning bid price of power plants affiliated to some groups in the last period was relatively low, which lowered the overall average price of sample calorific value in the previous period; the price of 3800 kcal/kg in Taicang Port (flexible type) decreased by 3 yuan/ton compared with the previous period. Recently, the imported coal market has continued to be weak, the market trading atmosphere has performed poorly, and bidding prices have dropped slightly.

CECI Purchasing Managers Index is 49.34%, and it is in the contraction range for three consecutive periods, up 0.24 percentage points month-on-month. Among them, the supply index was 51.29%, a month-on-month decrease of 1.04 percentage points, and was in the expansion range continuously, indicating that the supply of electricity and coal continued to increase and the growth rate narrowed. The demand sub-index was 49.57%, up 0.95 percentage points month-on-month, and was in the contraction range for three consecutive periods, indicating that the demand for power and coal continued to decline and the decline narrowed. The inventory sub-index was 49.78%, down 2.12 percentage points month-on-month, and fell to the contraction range after being in the expansion range for nine consecutive periods, indicating that the amount of electricity coal inventory has turned from increase to decline. The price index was 45.30%, up 2.47 percentage points month-on-month, and was in a contraction range for 9 consecutive periods, indicating that electricityCoal priceThe decline continued to decline, and the decline narrowed. The shipping sub-index was 48.93%, down 1.20 percentage points month-on-month, and fell to the contraction range after being in the expansion range for three consecutive periods, indicating that the price of electric coal shipping has changed from increase to decline.

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 November 25 to December 1, the national freight logistics was operated in an orderly manner, including: the national railway transported a total of 81.035 million tons of goods, a decrease of 1.08% month-on-month; the national expressways had a total of 54.732 million trucks, a decrease of 1.02% month-on-month. According to data from China Railway Urumqi Bureau, as of November 29, the external transportation volume of Xinjiang coal railways reached 81.479 million tons, a year-on-year increase of 52.4%.

According to the fuel statistics of the China Electric Power Industry in the Electric Power Industry, as of December 5, the cumulative power generation of coal-fired power plants of the power generation group included in the fuel statistics of the power industry this month decreased by 4.2% year-on-year, and the cumulative power generation this year increased by 0.8% year-on-year. The coal consumption of coal-fired power plants decreased by 3.2% year-on-year this month and 0.4% year-on-year this year. Coal inventory in coal-fired power plants was higher than 12.64 million tons in the same period last year, and the number of days available in stocks increased by 2.8 days compared with the same period last year.

Recently, the transportation volume of Daqin Line and Tanghu Line has not decreased, the Bohai Rim Port has been slow to destock, a large amount of imported coal has arrived on the shore and it still has price advantages, non-electric terminals have entered a period of peak production reduction, and in the short term, power plants mainly digest existing inventory, and procurement demand is unlikely to be released. At the end of the year, as the annual production tasks are completed one after another, some coal mines may reduce or stop production in the middle and late quarters. In addition, the recent weak sales situation at the pit entrance have suppressed production enthusiasm, and it is expected that the coal supply in the production area will decline month-on-month in December. The subsequent phased cold air will follow one after another, further increasing the consumption of electric coal, which may lead to a phased boost to the coal market sentiment. According to comprehensive judgment, before ports and power plants are significantly destocked, market coal prices will remain weak. According to the relevant deployment of the "Notice on Doing a Good Job in the Signing and Performing Medium- and Long-term Contracts of Electric Coal in 2025" (Development and Reform Office Operation [2024] No. 941), before December 10, the connection of resources, contract signing and entry, and the signing of the commitment letter for integrity should be completed. It is recommended that power enterprises accelerate the connection with coal enterprises, complete the signing of medium- and long-term contracts of electric coal in a timely manner as required, effectively sign and sign, resolutely implement the requirements of "high-quality and high-price", clarify the settlement mechanism for coal quality deviation, negotiate to determine the calorific value conversion coefficient, and eliminate non-compliance behaviors such as bundled sales and yin and yang contracts.