Market review this week:
CITIC coal index closed at 2960.5 points, down 3.12%, outperforming the Shanghai and Shenzhen 300 index by 1.1pct, ranking No. 6 in the rise and fall list of CITIC primary sector.
Analysis of key areas:
Power coal: after the rapid rise of coal price, the policy pressure is becoming more and more obvious. As of Friday, the mainstream quotation of port q5500 was about 1800 yuan / ton, up 420 yuan / ton on a weekly basis. In terms of origin, affected by the convening of the two sessions this week, the production in some areas is limited, and the overall supply of coal mines in origin is stable; In terms of sales, most coal mines mainly supply terminal power plants and actively perform long-term cooperation contracts. Some coal mines suspend external sales. It is difficult for non long-term cooperation users such as chemical industry to buy coal. The coal mines are produced and sold as a whole. In terms of ports, the port coal price continued to rise, and under the condition of improved shipping profits, traders’ enthusiasm for shipping increased, the daily average traffic volume of Daqin Line remained full, and the transfer in volume increased significantly; At the same time, the long-term cooperative procurement and transportation of power plants continued, the demand for non electric coal such as building materials & cement increased, and the transfer out volume remained high. On the whole, the transfer out is less than the transfer in, and the inventory in Beigang continues to increase, but the accumulation speed is slow and the available resources are tight. In the downstream, the weather turned warmer, the daily consumption of the power plant weakened, and the inventory turned from decline to increase. This week, under the warming wave running through the South and North, the average temperature rebounded, and the temperature in most parts of the country will be significantly higher than that in the same period of the year, resulting in a slow decline in daily consumption. Based on the steady progress of increasing coal production and supply, the coal supply of the power plant is sufficient, and the inventory has changed from decline to increase. After this round of replenishment, the pace of terminal procurement may slow down in stages under the background of warmer weather. In terms of import, the conflict between Russia and Ukraine continues, overseas coal prices rise sharply, and some imported coal hangs upside down, which will affect the subsequent coal import quantity to a certain extent. On the whole, the overall supply of coal mines in the producing area is stable. With the promotion of resumption of work and production, coupled with the increase of purchase prices of large groups, good purchase demand for chemicals and platforms, coal mine sales are hot, inventories are low, and the prices of producing areas and ports rise rapidly. At present, the profit of the shipping port of origin has expanded, the coal consumption load of the terminal power plant has gradually dropped, coupled with the expected increase of policy regulation, the acceptance of high prices in the downstream has decreased, the procurement rhythm has slowed down, the market quotation has begun to loosen since Friday, and more attention has been paid to the policy and daily consumption of the power plant in the later stage. The main contradiction of the power coal market is still in the coastal area, the storage of power coal in the port is at a low level in recent years, and the function of the reservoir is weakened; At the same time, the cost of imported coal is high, and China’s coal price is facing policy risks at any time, or lead to the reduction of import quantity, which will affect the supply of coastal power coal. If the problem of low inventory along the coast cannot be solved, even in the off-season, the coal price will rise again after the periodic decline. The medium and short-term 700800 yuan / ton should be the bottom area of the coastal coal price.
Coal prices continued to rise strongly, and the demand for coke in the lower reaches continued to rise. This week, the coking coal market operated strongly, the coking coal price continued to rise, and the transaction price of online auction continued to break through new highs, supporting the continued good operation of some coking coal prices. As of Friday, the Shanxi main coke of Jingtang Port had closed at 3350 yuan / ton, up 420 yuan / ton on a weekly basis. This week, affected by the two sessions, local safety inspections were strictly implemented, the output of coal mines was limited, and the epidemic affected the shipment of some coal mines in some areas, which slightly hindered the supply of coking coal market. In terms of importing Mongolian coal, the epidemic situation has gradually eased, and the customs clearance volume of Ganqi Maodu port has increased steadily. According to sxcoal data, customs clearance for three days this week (3.7-3.10), with an average of 174 vehicles per day, an increase of 31 vehicles per day compared with the same period last week; As China’s coal prices continue to rise, traders have a good attitude, and the Mongolian coal market continues to improve. At present, the mainstream quotation of Mongolian 5 raw coal is about 23502400 yuan / ton, and the mainstream quotation of Mongolian 5 clean coal is about 2800 yuan / ton. In terms of maritime import, according to the data of Fenwei information on March 9, the price difference between the low sulfur main coking coal (S0.5 g80-85) from Linfen and Changzhi to Tangshan, Hebei and the first-line coal from the United States and Canada with similar quality in the long term is 612 yuan / ton, and the upside down degree continues to increase, resulting in China’s no intention to receive the imported coal. On the demand side, the inventory of downstream coke steel enterprises is still at a historically low level. Driven by the improvement of profits, they have high procurement enthusiasm and strong performance on the demand side; However, the shortage of raw coal supply is difficult to alleviate, the supply of raw coal is tightening, and it is difficult to reduce the transportation due to the impact of the epidemic. There are many cases of passive inventory reduction, the accumulated inventory of coke and steel is less than expected, and the demand for subsequent replenishment is strong. In the short term, there is still room for improvement in downstream demand. With the superposition of low inventory of coke steel enterprises, the downstream has sufficient power to actively replenish the inventory, and the price of coking coal will still rise strongly.
Coke: demand will face strong recovery and cost support, and there is still room for 1 ~ 2 rounds of price increase. This week, the third round of coke rise landed. This round of rise was 200 yuan / ton, with a cumulative rise of 600 yuan / ton. Due to the tight implementation of the third round of coke production, it is difficult for enterprises to improve the production and production of coke, but the supply of raw materials at the end of the third round of coke production has been tightened, and the price of coke has been tightened. However, it is difficult for enterprises to improve the production and production of coke, and the supply of raw materials at the end of the third round of coke production has been tightened. On the demand side, affected by the two sessions, the operating rate of steel plant and hot metal output decreased; After the two sessions, the downstream steel mills will resume production one after another, and the subsequent hot metal output may rise rapidly. In addition, recently, affected by epidemic control and resource shortage, the arrival of coke in steel mills is generally poor, and there is a strong willingness to replenish the stock when the inventory is low. In terms of ports, due to the upside down of coke prices outside China, coke foreign trade orders are strong, supporting the continuous upward quotation. On the whole, after the two sessions, the downstream steel mills will resume production in an all-round way, and the coke demand will increase significantly. However, the supply side is subject to the shortage of raw material procurement and the coke profit is still in a state of low profit or even loss, and the production increase is weak. The short-term supply side will still be limited. In addition, the recent strong demand for foreign trade and the diversion of market resources will affect the further tightening of coke supply and demand, and the upstream and downstream enterprises will continue to reduce inventory, It is expected that there is still room for 1 ~ 2 rounds of increase in coke price.
Investment strategy. China will still be based on the basic national conditions dominated by coal, and traditional energy will not withdraw too soon. Under the background of limited room for tapping the potential of new production capacity and stock, the central rise of coal price will contribute to the stable release of performance and valuation repair of coal enterprises. In addition, China Shipbuilding Industry Group Power Co.Ltd(600482) coal, coking coal and coke prices are all global price depressions, and the upside down of prices will significantly affect China’s import volume. Even there is export arbitrage space for some varieties after processing finished products, which will form a strong support for China’s coal prices. Stick to the core assets and be optimistic about the valuation repair of high long-term association and high score red coal enterprises. Key recommendations: China Shenhua Energy Company Limited(601088) , China Coal Energy Company Limited(601898) , Shaanxi Coal Industry Company Limited(601225) , Pingdingshan Tianan Coal Mining Co.Ltd(601666) . Key recommendations: Pingdingshan Tianan Coal Mining Co.Ltd(601666) , Shanxi Coal International Energy Group Co.Ltd(600546) , Shanxi Lu’An Environmental Energydev.Co.Ltd(601699) ; Anthracite target Shanxi Lanhua Sci-Tech Venture Co.Ltd(600123) , benefiting from the development of coal chemical industry. In addition, the transformation of traditional energy enterprises under the goal of “double carbon” is worth looking forward to. The key recommendations are power investment energy (green power), Shan Xi Hua Yang Group New Energy Co.Ltd(600348) (energy storage), Huaibei Mining Holdings Co.Ltd(600985) (new materials and green power), Yankuang energy (new materials and green power), Shanxi Meijin Energy Co.Ltd(000723) (hydrogen energy) and China Xuyang group (hydrogen energy). Actively layout the national reform in Shanxi, and focus on recommending Jinneng Holding Shanxi Coal Industry Co.Ltd(601001) , Shanxi Coking Coal Energy Group Co.Ltd(000983) , with expected asset injection.
Risk tip: China’s output release exceeded expectations, the downstream demand was less than expected, and the on grid electricity price was significantly reduced.
