Coal industry development in coastal cities is in good shape

In August, the port of coal transportation in northern China appeared to be concentrative, with the enthusiasm of upgrading the inventory of coastal power plants in East China and the increase in the number of ships. The author believes that the increase in demand for electric coal transportation is a reflection of phased inventory restocking at the power plant. Whether the transportation situation can continue to improve still needs further observation. The coal price is constrained by imported coal, and it is difficult to make significant corrections.

Throughout July, there were 26 ships anchored at Qinhuangdao port on a daily average basis, of which only 8 were handled. At the beginning of August, the situation of a sluggish transport situation has improved. From August 3 to August 10, the average daily anchorage of the Qinhuangdao port was 35, of which 19 had already been handled. On August 11, the number of anchored ships increased further to 53, of which 17 have already been processed. These two figures are still increasing.

Since July, the continued high-temperature weather in many places has increased the coal consumption of power plants. The increase in air-conditioning electricity consumption has led to continuous new high electricity load. The six major coastal power plants including Zhejiang Energy and Power Co., Ltd. have been used daily for 650,000 tons from June. It increased to 850,000 tons on August 11th, of which the daily consumption of Zheneng Power Plant reached 155,000 tons. This has accelerated the “destocking” of major coastal power plants, and the number of available coal deposits in major power plants has further decreased.

In early August, the country's key power plants stored 68.63 million tons of coal, a decrease of 5.35 million tons from the beginning of July, the lowest level this year. Among them, Huadong Power Plant has stored 12.53 million tons of coal, the number of available days fell from 17 days to 12 days; Zhejiang power plant stored 2.5 million tons of coal, the number of available days from 12 days to 9 days.

The continuous hot weather has also aggravated the drought situation in the south. The hydroelectricity in Hunan and Guizhou is weak and the number of “West Power Transmission to the East” has decreased, which has increased the demand for thermal power.

In September, the Datong-Qinhuangdao Line is about to start a second round of overhaul for a period of 12 days to 15 days, at which time the amount of coal imported into the port will be reduced. Power plants make up the inventory, but also have this consideration.

However, there is no significant increase in industrial electricity consumption, which occupies a dominant position in electricity use. As it is generally expected that the economic environment will not have a big improvement, the pattern of oversupply of the coastal coal market will be difficult to change in the short term, and the pessimistic atmosphere still exists.

The increase in electricity demand during the summer is not enough to drive up the price of coal. Therefore, we see that the thermal coal prices in East China remain stable, and the price of coal around the Bohai Sea continues to fall. I expect that in August, most coal companies and distributors still have the possibility of price cuts, but the decline will be narrowed.

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