Under the pressure of high inventories, when will coal prices bottom?

Recently, the inventory of the middle and downstream links has continued to be high, the consumption of thermal coal is at a seasonal low, the urgency and enthusiasm of the downstream to take goods are not high, and the trading atmosphere of the port market is still cold. The pressure on the Bohai Rim ports to evacuate the port has increased, forcing traders to speed up the departure of goods in a short period of time, prompting the port coal prices to continue to decline and pull back in general. At present, the port coal price has fallen below 830 RMB/ton.

The inventory of terminal power plants is still at a high level, whether it is a unified power plant, a direct railway power plant, a key power plant, or a coastal power plant, all of which are at a high level. Downstream users mostly maintain a wait-and-see attitude, and the inquiry price is not good; Most of the power plants replenish the warehouse mainly in long-term agreements, and there is basically no procurement demand for market coal, and a small amount of rigid demand is also purchased at a reduced price. At present, the Daqin Line and Tanghu Line have sufficient capacity, stable traffic flow, and the closure of navigation in bad weather, which makes the inventory of Bohai Rim ports continue to rise, and some ports have a shortage of sites and stacks, and the pressure on port dredging has increased; Traders' pessimism fermented, and the decline in quotations expanded. This week, there is a nationwide cold air southward, there will be a phased cooling, perhaps some traders to bring the price to a little stable, but the general trend of coal prices falling remains unchanged, it is expected that the port coal price will have 5-10 RMB/ton of room to fall; Before the inventory of the Bohai Rim port cannot be effectively reduced, the port coal price will continue to decline weakly.

In the past two months, the amount of coal shipped by railway is still at a high level, the inventory of the Bohai Rim port continues to accumulate, the daily consumption of power plants has increased slowly, and the inventory is high, which cannot digest the high inventory; In winter, the demand for cement has gradually weakened, and the amount of coal purchased from the market has decreased. The Bohai Rim port market continued to decline, traders' quotations fell slightly, downstream demand increased slightly, and inquiries were still dominated by price reduction, which was difficult to trade. It is worth noting that the cold wave is affecting our country from west to east, and the temperature in most parts of our country has changed from high to slightly lower or close to the same period of the year, and the demand for heating electricity in the downstream is expected to increase greatly, and the daily consumption of power plants in eight coastal provinces will exceed 2 million tons. However, due to the fact that the inventory of all links in the society and the supply of low-cost resources such as long-term agreements and imports are still at the high level of previous years, the power plant is in the stage of consuming inventory, resulting in no support for the rise in port coal prices.

It is the first half of winter, the downstream wait-and-see, the inquiry price is cold, and the actual transaction situation is not good; The available inventory of downstream power plants is still high, and the willingness to purchase is still negative. The only positive thing is that the arrival cost of Bohai Rim ports and sellers is high, and as the temperature gets colder, thermal coal procurement and consumption demand are also expected to grow. After small and medium-sized traders clear their warehouses and leave the market and the pressure is reduced, the market reluctance of major traders and mining enterprises to sell and raise prices may be rekindled, driving the decline in coal prices to narrow, or even rebound slightly.