Zheshang Securities(SH:601878) 智通财经网·2025-06-18 03:07Core Viewpoint - The coal supply growth rate is declining but remains high, while demand is weak, particularly in the power sector. The chemical sector shows better demand. Coal prices have significantly decreased, and stable long-term contract prices are expected. Policy expectations are increasing due to weak supply-demand fundamentals, with a need for production cuts to stabilize coal prices [1][4]. Supply - Domestic coal production continues to grow, but the growth rate has decreased. From January to May 2025, the total raw coal production reached 1.985 billion tons, a year-on-year increase of 6.0%. In May alone, production was 403 million tons, up 4.2% year-on-year [2]. - Coal imports have slightly decreased, with a total of 189 million tons imported from January to May, down 7.9% year-on-year. In May, imports were 36.04 million tons, a decrease of 17.8% year-on-year [2]. - The transportation of coal from Xinjiang has declined, with a total of 22.01 million tons transported by rail from January to March 2025. In April, policies were introduced to reduce transportation costs, alleviating pressure on coal transportation [2]. Demand - Coal consumption has shown signs of weakness but remains resilient overall. From January to April 2025, total coal consumption was approximately 1.66 billion tons, a year-on-year increase of 0.3%. The chemical industry experienced the fastest growth, consuming 140 million tons, up 10.8% year-on-year [3]. - The steel industry consumed 230 million tons, a 2.8% increase year-on-year, while the building materials sector saw a decline of 1.9% with 140 million tons consumed. The power sector experienced a significant drop, consuming 940 million tons, down 2.7% year-on-year [3]. Price - The average prices of various coal types have decreased. From January to May, the average prices for thermal coal, coking coal, and anthracite were 740.0, 1406.5, and 898.4 yuan per ton, respectively, representing year-on-year declines of 20.5%, 38.7%, and 7.1% [4]. - The long-term contract price for Qinhuangdao 5500 kcal thermal coal decreased from 693 yuan per ton at the beginning of the year to 669 yuan per ton in June. It is expected that long-term contract prices will stabilize as spot prices gradually stabilize [4]. Policy - The company anticipates that policy measures will be implemented based on historical experiences, with expectations for effective outcomes. The company has gained experience from previous supply-side structural reforms and energy production increases to address coal overcapacity and supply tightness [4]. - To stabilize coal prices, it is predicted that production must be reduced by at least 57 million tons from June to December, even under optimistic demand scenarios. In neutral and pessimistic demand scenarios, reductions of 81 million tons and 106 million tons are required, respectively [4].