CCTD Weekly Review - China (07/21-07/27)

Edited and Updated by Ethan Ma

Overall: Coal Prices Continue to Rise, Market Sentiment Remains Positive

At the ports: End-users are mainly fulfilling long-term contracts and making rigid purchases, with limited spot coal demand. However, due to high port delivery costs, tightening production policies at origin, and weather disruptions, traders are optimistic about future trends, showing strong price-holding sentiment and steadily increasing their quotations.

At production regions: Peak-season demand has boosted thermal coal transportation, while factors such as end-of-month maintenance, weather, and overproduction inspections are restricting supply. As a result, mines are strongly inclined to support prices, with a clear intention to raise them.

Outlook:
In the short term, coal prices are expected to continue rising moderately. On one hand, traders are facing high delivery costs, and with continued seasonal demand and tight supply, price-holding sentiment remains strong. On the other hand, downstream power plants are not increasing procurement significantly and show limited acceptance of high prices, capping the potential for further price rises.

[Regional Breakdown]

Bohai Ports:
The port market remains moderately strong. Rising origin prices have reinforced cost support for port coal, and structural supply shortages at ports have yet to improve. Traders are showing strong price-holding sentiment. However, downstream demand lacks new momentum, and procurement is mainly limited to fulfilling long-term contracts and meeting rigid needs. Future focus will be on terminal demand performance.

East China:
Thermal coal prices saw slight increases in the region. Coke prices are undergoing a third round of hikes. Coking coal prices in major producing areas continue to rise, while the pace of coke price adjustments lags behind. Many coking plants face cost inversions and are reluctant to sell. Steel mills maintain high operating rates, with strong rigid demand and relatively tight inventories. Overall, the fundamentals for coke remain strong, with attention on steel plant demand going forward.

North China:
Coke prices are steadily strengthening. Coking plants are under pressure from continuously rising coking coal prices, facing increasing losses and widespread cost inversions. Inventory levels are low, and coke is selling smoothly. A third round of price hikes is underway. Steel mills are seeing decent profits, with hot metal production staying high and strong rigid demand for coke. Overall supply and demand fundamentals are healthy, and future focus remains on steel mill demand.

According to CCTD monitoring data, compared with the previous period, coking coal prices in Shanxi rose by 0–120 yuan/ton, and in Linfen by 0–80 yuan/ton. Thermal coal prices also saw slight increases.

Northeast and Eastern Inner Mongolia:
Regional prices remain generally stable. Long-term coal supply is steady, and end-user daily consumption is rising. The market remains balanced overall.

Central South China:
Regional coal prices saw slight increases. Power plants are operating at high consumption levels during the peak season. However, with long-term contracts securing supply, most plants face low inventory pressure and continue rigid procurement from the market. Demand increment remains limited. Supported by traders’ cost base and optimistic outlook, market quotations continue to rise slightly. Overall, the market remains stable and firm, with attention on downstream demand ahead.

As of July 22, 2025, Hubei Province recorded daily electricity consumption of 1.032 billion kWh and a maximum load of 44.85 million kW.

South China:
Import coal prices fluctuated within a narrow range. With international freight costs continuing to rise, the delivered cost of imported coal remains high. Meanwhile, domestic power plant inventories are relatively sufficient. End-users are cautious in procurement, with transactions mostly driven by rigid demand. Acceptance of current offshore quotations remains limited, and future attention is on end-user demand dynamics.

Northwest China:
Long-term contract coal prices at origin remain stable, while market coal prices have edged up slightly. End-user thermal coal demand remains firm, and pithead transportation is smooth, supporting higher price levels. Traders also show solid demand. Supply has tightened slightly due to overproduction checks, end-of-month halts, and weather factors, exacerbating the tight supply-demand balance. Bullish sentiment continues, with focus on downstream demand trends.

Southwest China:
Thermal coal prices remained generally stable during the week. The coke market was steady to firm. Steel mills maintained high profitability and operating rates, with strong enthusiasm for production and robust demand for coke. Coking plants are experiencing continued cost inversions due to rising coking coal prices, prompting a third round of price hikes. Sales are smooth, and a reluctance to sell is emerging. Thermal coal production is running well, long-term contract deliveries are stable, and end-user daily consumption is rising. With increased safety supervision, the market remains overall stable.