The cold wave is coming, the demand margin is improving, and we are optimistic about the transformation and growth potential of coal enterprises
The price of thermal coal was weak this week, and the port price decreased greatly, mainly due to the high inventory of power plants and the wide balance between supply and demand, which basically had weak support for coal price, and was driven by the reduction of purchased coal price of large groups this week. The demand side performance has improved this week. The cold wave hit and the country has cooled down on a large scale, supporting the high increase of daily consumption of power plants as scheduled and driving the current power plant to increase the de inventory. However, considering that the coal storage and available days of power plants are still high, the overall procurement demand is weak; In terms of supply, the current supply guarantee policy is still being implemented, but the safety production situation caused by the recent coal mine theft accident in Shanxi tends to be severe, and the increased security inspection in many places has tightened the supply margin of producing areas. Overall, the current supply and demand fundamentals are broadly balanced, but the marginal supply and demand show signs of improvement. Later judgment, we believe that the space for coal price decline may be limited. In terms of demand, we still need to pay attention to the demand performance of cold winter in the short term. At present, the cold air activity is strengthened, and the daily consumption of the power plant still has room to rise. At the same time, we also need to pay attention to the de inventory of the power plant; In terms of supply, we need to pay attention to the marginal change of safety supervision. On the basis of the basic guarantee of coal supply in the short term, the policy pays more attention to safety production. Both Shanxi and Shaanxi strengthen security inspection and carry out special activities. The seesaw effect between safety and supply may be reflected again, and there may be supply tightening in the later stage. In the medium and long term, the policy threshold for the approval of supply side coal mine projects will be raised, and the incremental supplement of new production capacity to coal supply in the next 2 ~ 3 years will be limited; On the demand side, the steady growth trend of thermal power demand may not change during the 14th Five Year Plan period, providing support for the demand for thermal coal. We believe that the coal industry has gradually entered the era of high profitability, and its performance may tend to release steadily. On this basis, some coal enterprises have begun to layout new energy, new materials and other new tracks for transformation, comply with the direction of double carbon policy, and take Yankuang energy as an example in combination with the relevant statements of “based on the basic national conditions dominated by coal” and “promoting the optimal combination of coal and new energy” at the central economic work conference Represented by coal enterprises such as power investment energy, we are optimistic about the transformation and growth potential of traditional energy enterprises. Targets with stable performance and high dividends: Yankuang energy, China Shenhua Energy Company Limited(601088) , Shaanxi Coal Industry Company Limited(601225) , Pingdingshan Tianan Coal Mining Co.Ltd(601666) ; Objects with expected growth benefits: Shanxi Coking Coal Energy Group Co.Ltd(000983) , Jinneng Holding Shanxi Coal Industry Co.Ltd(601001) , Guizhou Panjiang Refined Coal Co.Ltd(600395) , Huaibei Mining Holdings Co.Ltd(600985) ; Shenzhen New Industries Biomedical Engineering Co.Ltd(300832) transformation target beneficiary targets: Shan Xi Hua Yang Group New Energy Co.Ltd(600348) , Shanxi Coal International Energy Group Co.Ltd(600546) , power investment energy, Jinneng Science&Technology Co.Ltd(603113) , China Xuyang group (H shares); debt restructuring beneficiary targets: Wintime Energy Co.Ltd(600157) .
Coal power industry chain: the price of power coal fell under pressure this week, and there were marginal signs of good supply and demand
This week (December 20-24, 2021) the price of thermal coal was weak, and the spot price of q5500 thermal coal in QinGang fell below 1000 yuan. The decline in coal price was mainly due to the high inventory of power plants and the wide balance between supply and demand, which basically had weak support for coal price. At the same time, it was driven by the reduction in the price of purchased coal by large groups this week. The performance of the demand side improved this week, the cold wave hit, a large-scale cooling across the country, and many places hit this winter’s record The new low temperature supports the high increase of daily consumption of the power plant as scheduled, and drives the current power plant to increase the de inventory. However, considering that the coal storage and available days of the power plant are still high, the overall procurement demand is weak; In terms of supply, the current supply guarantee policy is still being implemented, but the safety production situation caused by the recent coal mine theft accident in Shanxi tends to be severe, and the increased security inspection in many places has tightened the supply margin of producing areas. Overall, the current supply and demand fundamentals are broadly balanced, but the marginal supply and demand show signs of improvement.
Coal coke steel industry chain: coking coal rose this week & Coke was stable, and steel mills’ willingness to replenish double coke storage was enhanced
Coke: this week, the coke price temporarily operated stably, the marginal fundamentals were good, and there was support for the rise of coke price. In terms of demand, although the current iron and steel production restriction is still strictly implemented, the expectation for the resumption of blast furnace production in the later stage is enhanced, the steel mills have started to replenish the warehouse one after another, and the margin at the demand end is slightly better; In terms of supply, the intensity of environmental protection and production restriction is not reduced, the operating rate of coke enterprises is low, at the same time, near the end of the year, some backward production capacity is about to be shut down, and the supply side is gradually tightened. Coking coal: the price of coking coal origin is strong this week. In terms of supply, the recent coal mine accident in Shanxi has led to increased security inspection. At the same time, some coal mines that have completed the task of ensuring supply have taken the initiative to stop and reduce production, and the supply of coking coal is tightening; In terms of demand, the willingness of downstream coke steel enterprises to replenish inventory has increased, and the coke coal inventory has gradually increased recently. From the perspective of policy, the central economic work conference releases the signal of steady growth, guides the expected repair of infrastructure and real estate, or forms a positive impact on the future market of coal, coke and steel industry.
Risk tips: downside risk of economic growth, mismatch risk of supply and demand, accelerated substitution risk of renewable energy
