Summary of this issue:
The logic of production capacity remains unchanged, and the power coal pit mouth price operates at a high level in the off-season. As of the same period last year, the price of coal in Yulin was 660 yuan / ton, up from 660 yuan / week in the same period last year; The pit mouth price of sticky coal (including tax) (q5500) in the southern suburb of Datong was 1110.0 yuan / ton, an increase of 85.0 yuan / ton on a weekly basis, an increase of 617 yuan / ton over the same period last year; Inner Mongolia Dongsheng large clean coal truck sector price (q5500) was 992.0 yuan / ton, down 55.0 yuan / ton on a weekly basis, an increase of 560 yuan / ton over the same period last year.
The enthusiasm for short-term transportation decreased, and the replenishment of warehouses at the port was smooth. This week, 6243 trains arrived on the Qinhuangdao Port Railway, down 2.53% from the previous week; Qinhuangdao Port handled 531000 tons, an increase of 5.36% over the previous week. As of March 25, the inventory of the four major ports around the Bohai Sea (Qinhuangdao port, Huanghua port, Caofeidian port and east port of Jingtang Port) was 12.45 million tons (an increase of 1 million tons on a weekly basis), the number of anchorage ships was 141.0 (a decrease of 22.00 on a weekly basis), and the cargo ship ratio (inventory to ship ratio) was 9.6 (an increase of 1.11 on a weekly basis). In the off-season, traders’ willingness to transport decreased, and the port inventory rebounded smoothly.
Coal inventories in all provinces continued to decline. As of March 24, the coal inventory of the eight coastal provinces was 26.441 million tons, with a decrease of 453000 tons (a decrease of 1.68%) on a weekly basis. The daily consumption was 1.794 million tons, with a decrease of 32000 tons / day (- 1.75%) on a weekly basis. The available days were 14.7 days, which was flat on a weekly basis. As of March 25, the market price of Qinhuangdao port thermal coal (q5500) produced in Shanxi was 900.0 yuan / ton, unchanged on a weekly basis. International coal price: as of March 23, the FOB spot price of Newcastle newc5500 kcal thermal coal was US $200.05/ton, down US $99.6/ton on a weekly basis; The spot price of ara6000 kcal thermal coal was US $295 / ton, down US $11.05/ton on a weekly basis; Richard RB’s FOB spot price of thermal coal was US $236 / ton, up US $13.7/ton on a weekly basis. As of March 25, the active contract of thermal coal futures increased by 36.6 yuan / ton to 865.6 yuan / ton compared with the same period last week, and the futures discount was 34.4 yuan / ton. The high operation of overseas coal prices, coupled with the weakening enthusiasm of Chinese traders in coal transportation, has not yet entered the replenishment stage of provincial coal inventories.
Coke: the ability of epidemic prevention and control and transportation is insufficient, and the inventory of coke enterprises rises, which will be stable in the future. As of March 25, 2022, Fenwei CCI Luliang quasi primary metallurgical coke reported 3360 yuan / ton, which was flat on a weekly basis, with a month on month increase of 21.73% and a year-on-year increase of 72.31%. Port index: CCI Rizhao quasi primary metallurgical coke reported 3520 yuan / ton, down 60 yuan / ton on a weekly basis, up 12.82% on a monthly basis and 74.25% on a year-on-year basis. Under the impact of the epidemic, the transportation capacity of roads and railways and the accumulation of coke enterprises at the production end are obvious; The demand side is also seriously affected by the epidemic, the production rhythm is interrupted, and some steel mills have furnace stewing or limited production. At present, the overall supply and demand of coke market is stable, and it is expected to slow down in the later stage.
Coking coal: the market is weak under the impact of the epidemic. As of March 23, CCI Shanxi low sulfur index was 3275 yuan / ton, down 60 yuan / ton on a weekly basis and up 745 yuan / ton on a monthly basis; CCI Shanxi high sulfur index was 2940 yuan / ton, unchanged on a weekly basis and increased by 677 yuan / ton on a monthly basis; Lingshi fat coal index was 2700 yuan / ton, unchanged on a weekly basis and increased by 550 yuan / ton on a monthly basis. The traffic control efforts of all localities have been strengthened, the coal shipping capacity is insufficient, and the trading volume has decreased significantly.
We believe that at present, we are in the early stage of a new round of upward cycle of coal economy, and the fundamentals, policies and companies resonate. At this stage, the allocation of coal sector is at the right time. On March 22, Han Zheng presided over a symposium on clean and efficient utilization of coal. He said that “we should adhere to the actual situation of China, promote clean and efficient utilization of coal, give full play to the bottom-up guarantee role of coal, and ensure the safe supply of national energy and electricity”. At present, there are three specific tasks to achieve clean and efficient utilization of coal in China. First, take the “clean coal strategy” to improve the washing of commercial coal; Second, coal based raw materials and fuels, coal based raw materials, and expand the differentiated and high-end development of modern coal chemical products; Third, strengthen scientific research in the fields of carbon capture, carbon burial and carbon cycle, and promote breakthroughs in carbon reduction technologies. In this context, we should pay close attention to the development opportunities of modern coal chemical industry and the stability and sustainability of coal production and consumption in the future. At this stage, the industry fundamentals, the underlying logic of the policy and the direct effect are favorable for the repair and improvement of the valuation of the sector. Considering the certainty of the high growth of performance in the first half of this year, it is the best stage for bargain hunting to allocate the coal sector. Investment rating: we continue to look at the coal sector in an all-round way and continue to suggest paying attention to the historic allocation opportunities of coal. It is suggested to pay attention to three main investment lines: first, Yankuang energy, the leader of low value and high dividend power coal, Shaanxi Coal Industry Company Limited(601225) , China Shenhua Energy Company Limited(601088) ; Second, Pingdingshan Tianan Coal Mining Co.Ltd(601666) , Guizhou Panjiang Refined Coal Co.Ltd(600395) , which are both resource scarcity and significant growth; Third, Shanxi Coking Coal Energy Group Co.Ltd(000983) and Jinneng Holding Shanxi Coal Industry Co.Ltd(601001) , which have great potential for extensive expansion brought by the increase of asset securitization rate of state-owned coal group.
Risk factors: coal mine safety production accidents in key companies; The macro economy has fallen sharply.
