Monday, 10 October 2011
During China’s Golden Week, the coal stocks in China’s Qin Huang Dao (QHD) port plunged to a two year low of 3.97 million tonnes, a 46% slash from 7.3 million
tonnes in early September. Two points are worth mentioning regards to this phenomenon. Firstly, China’s DaQin railway went into the 2nd round of maintenance for around 15 days (20 Sep to 5 Oct), which results in a daily reduction of 0.3 million tonnes in coal shipments to northern ports. Secondly, five coal mines, which account for around 5 million tonnes of monthly output, have been forced to shut down for overhauls after a fatal accident. China’s domestic coal prices, as a result, have reasonably begun to creep up. After the Golden Week when the DaQin railway is back to full capacity, QHD port’s coal stocks are expected to be gradually refilled. Nonetheless, as Chinese power producers ramp up their seasonal restocking during the remainder of the October, this will likely create support for coal prices and also imply firm demand for domestic and foreign coal suppliers this month.
Source: ICAP Shipping
During China’s Golden Week, the coal stocks in China’s Qin Huang Dao (QHD) port plunged to a two year low of 3.97 million tonnes, a 46% slash from 7.3 million
tonnes in early September. Two points are worth mentioning regards to this phenomenon. Firstly, China’s DaQin railway went into the 2nd round of maintenance for around 15 days (20 Sep to 5 Oct), which results in a daily reduction of 0.3 million tonnes in coal shipments to northern ports. Secondly, five coal mines, which account for around 5 million tonnes of monthly output, have been forced to shut down for overhauls after a fatal accident. China’s domestic coal prices, as a result, have reasonably begun to creep up. After the Golden Week when the DaQin railway is back to full capacity, QHD port’s coal stocks are expected to be gradually refilled. Nonetheless, as Chinese power producers ramp up their seasonal restocking during the remainder of the October, this will likely create support for coal prices and also imply firm demand for domestic and foreign coal suppliers this month.
Source: ICAP Shipping
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