Stop the decline and rebound of power coal & double coke supply and demand meet the inflection point, and continue to be optimistic about the main line of coal enterprise transformation
This week, the price of power coal stopped falling and rebounded. The spot price of q5500 power coal in QinGang rebounded to 830 yuan / ton. The role of Indonesia’s restrictions on coal export in driving market sentiment began to appear. In terms of demand this week, the daily consumption of the power plant remained relatively high, but the coal storage level was still abundant, and the demand for replenishment and procurement of the power plant was not strong. In addition, the demand for replenishment of non coal users gradually increased before the Spring Festival, providing a certain toughness for the current coal demand; In terms of supply, after new year’s day, the overhauled coal mines began to resume production, the production area resumed high load production, and the supply was stable as a whole. The supply of imported coal is greatly affected by Indonesia’s restrictions on coal export, and a large number of coal ships are stranded in Indonesian ports. Overall, the current supply and demand fundamentals remain broadly balanced. Judging from the later stage, the current coal consumption demand in winter has entered the seasonal peak stage, the daily consumption and replenishment demand may gradually weaken before the Spring Festival, and the rebound space of current coal price may be limited; However, from the supply side, after the peak season comes to an end, the policy focus may focus on ensuring safety. At present, the production intensity of ultra-high load is unsustainable, superimposed with the impact of Indonesia’s coal export ban, there is a great possibility of tightening supply after the Spring Festival, there is a large possibility of fundamental excess supply, and the coal price is expected to operate stably. Considering that there are still political and commercial disputes between Indonesia and China on restricting coal export, we still need to pay attention to the implementation progress of relevant policies in Indonesia in the short term. In terms of coking coal, the price of coking coal at the place of origin ushered in a new round of rise this week. The resumption of blast furnace production of steel mills is expected to boost the demand for replenishment at the downstream of coking steel. At the same time, the force of origin security inspection and the disturbance of Mongolian coal import epidemic tightened the supply, and the fundamentals of coking coal ushered in a phased inflection point. In the medium and long term, the era of energy transformation is coming. In the next few years, the supply and demand of coal may still be in tight balance, and the coal price will continue to be supported. The coal industry will gradually enter the era of high profitability. The next 5-10 years will be a strategic opportunity period for the layout and transformation of coal enterprises. Abundant cash flow is enough to support the layout and transformation of new energy, new materials and other new tracks of coal enterprises, and comply with the direction of double carbon policy. Among them, the transformation of green power operators has low short-term investment, rapid profit cashing and relatively stable cash flow. Combined with existing industries, it can form an energy diversification matrix of “complementary scenery and fire”, which is the transformation choice of most coal enterprises. Among them, we recommend the power investment energy that has formed the installed capacity of new energy and Yankuang energy, which defines the long-term green power transformation plan, and 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 beneficiaries: 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); Object of benefit from debt restructuring: Wintime Energy Co.Ltd(600157) .
Coal power industry chain: this week, power coal prices stopped falling and rebounded, and Indonesia’s export restrictions boosted market sentiment
This week (from January 3 to January 7, 2022), the price of thermal coal stopped falling and rebounded, and the spot price of q5500 thermal coal in QinGang rebounded to 830 yuan / ton. The role of Indonesia’s restrictions on coal export in stimulating market sentiment began to appear. In terms of demand this week, the daily consumption of the power plant remained relatively high, but the coal storage level was still abundant, and the demand for replenishment and procurement of the power plant was not strong. In addition, the demand for replenishment of non coal users gradually increased before the Spring Festival, providing a certain toughness for the current coal demand; In terms of supply, after new year’s day, the overhauled coal mines began to resume production, the production area resumed high load production, and the supply was stable as a whole. The supply of imported coal is greatly affected by Indonesia’s restrictions on coal export, and a large number of coal ships are stranded in Indonesian ports. Overall, the current supply and demand fundamentals remain broadly balanced.
Coal coke steel industry chain: Double coke rose this week, and the resumption of steel plant production boosted the demand for double coke replenishment
Coke: the coke price was raised by 200 yuan again this week. In terms of demand, after new year’s day, the pace of resumption of production of steel mills is accelerated, and the place of origin in North China is obvious. This week, the operating rate of Tangshan blast furnace increased significantly, driving the demand for coke to be better; In terms of supply, the impact of environmental protection and production restriction remains, the operating rate of coke enterprises is still low, and the coke fundamentals have changed from weak to strong. At the same time, with the increase of coking coal price, the cost side support of coking coal price is improved. Coking coal: this week, the price of coking coal in the producing area ushered in a new round of rise. The resumption of blast furnace production in the steel plant is expected to boost the demand for replenishment in the downstream of coking steel. At the same time, the continuous force of origin security inspection has limited the release of output, and the customs clearance of Mongolian coal at the import end is disturbed by the epidemic situation again. Coking coal fundamentals ushered in a phased inflection point and gradually turned to tight balance, driving the rise of coking coal prices.
Risk tip: downside risk of economic growth, mismatch risk of supply and demand, rebound of accelerated substitution risk of renewable energy & double coke supply and demand meet the inflection point and continue to be optimistic about the main line of coal enterprise transformation
