Coal news and updates

China Shenhua October sales slide 15.7% m-o-m

China Shenhua Energy Company, a listed arm of coal giant Shenhua Group, saw its coal sales in October slide 15.7% on month and down 23.9% on year to 26.4 million tonnes, despite successive price cuts in the month, sources learned from the company’s announcement on November 16.

The company realized coal sales via northern Chinese ports at 13.8 million tonnes in October, falling 21.1% on year and down 18.34% on month, with sales over January-October falling 14.3% on year to 167.2 million tonnes.

Of the October sales, 3.1 million tonnes or 63.3% of the total decreased volume were from coal sold via northern Chinese ports, compared with September sales.

Coal shipped from Shenhua’s exclusive-use Huanghua port stood at 7.3 million tonnes or 52.9% of the total in October, sliding 22.3% on year and down 27% on month.

Sales over January-October stood at 305.3 million tonnes, down 18.8% from the year prior, accounting for 75.5% of the sales target for the whole year, it said.

On October 9, Shenhua offered a 15 yuan/t discount for monthly purchase at or above 40,000 tonne of 5,500 Kcal/kg NAR shipped coal and a 10 yuan/t discount for the same purchase volume of other coal varieties.

Seeing continued slack sales, Shenhua offered its "Shenyou" variety a discount of 0.068 yuan/t/Kcal. It offered the price of its 5,500 and 5,000 Kcal/kg NAR coal at 374 yuan/t and 340 yuan/t FOB Qinhuangdao, down 16 yuan/t and 10 yuan/t from its self-produced mixed coal with the same calorific value , respectively.

However, successive price cuts of large coal producers did not actually improve the current sluggish market, and they turned to stabilize prices before the end of the year, in the hope of a favorable turn amid the slight demand rebound from coastal power plants in November.

In addition, the company produced a total 233.8 million tonnes of commercial coal or 85.5% of the annual target over January-October, down 9.2% on year.

Coal output in October stood at 23.2 million tonnes, up 4.5% from September but down 1.3% on year.

Coal imports over January-October slumped 98.5% on year to 100,000 tonnes, with October imports down 100% from a year ago to zero.

Coal exports during the same period fell 35.7% on year to 900,000 tonnes, with October exports down 50% to 100,000 tonnes.

Additionally, power output of the company in the first ten months this year decreased 3.3% on year to 186.49TWh, with October output down 1.9% to 17.77TWh.

The company sold 173.51TWh of electricity during the same period, down 3.4% on year, with sales in the month falling 3.3% to 16.32TWh.

Some downstream utilities predicted further price cut in Shenhua and other large coal producers in November, due to unimproved demand from downstream sectors, despite Shenhua’s steady pricing in November.

source: http://en.sxcoal.com