According to the Zhitong Finance APP, Shanxi Securities released a research report stating that the trend of shrinking imported coal volume is slowing down. In July, the year-on-year negative growth rate showed a marginal slowdown, and there was positive growth compared to the previous month. The reversal of internal competition in July led to a stabilization and rebound in domestic coal prices. Domestic raw coal production showed a shrinking trend both year-on-year and month-on-month, and the domestic gap has somewhat boosted the demand for imported coal. As coal prices continue to rise beyond expectations, the performance recovery of coal stocks is anticipated. Key stocks to watch include Huayang Co., Ltd. (600348.SH), Jinkong Coal Industry (601001.SH), Shanmei International (600546.SH), and Lu'an EED (601699.SH), among other elastic targets.
<h2>The main points of Shanxi Securities are as follows:</h2>
The trend of shrinking imported coal volume is slowing down, and import prices are declining
In terms of import volume, the cumulative growth rate from January to July was -13%, and the cumulative import volume still shows a shrinking trend; although the year-on-year negative growth rate in July has maintained a negative growth for five consecutive months, the year-on-year negative growth rate showed a marginal slowdown, with positive growth compared to the previous month. In July, the year-on-year import coal volume decreased by 22.94%, while it increased by 7.78% compared to the previous month. By coal type, all types of coal still showed negative growth year-on-year, but only anthracite showed negative growth month-on-month. The increase in coking coal mainly came from Mongolia and Russia; the increase in thermal coal mainly came from Australia; and the increase in lignite mainly came from Indonesia. In terms of price, the import price for all coal types was $67 per ton, maintaining a year-on-year decline trend, with a month-on-month decrease of $6.23 per ton in July. By coal type, the import prices for all coal types have significantly decreased compared to the same period last year, and the prices for all coal types showed a declining trend month-on-month in July.
Domestic gap drives import demand
The reversal of internal competition in July led to a stabilization and rebound in domestic coal prices. Domestic raw coal production showed a shrinking trend both year-on-year and month-on-month, and the domestic gap has somewhat boosted the demand for imported coal. Structurally, coking coal has already changed in June, and with the arrival of the peak season in July, thermal coal and lignite followed the trend of coking coal, but anthracite still showed an accelerating shrinking trend.
Future import increments remain to be observed
Although the import volume has increased, the import prices have not risen with the increment. The &#34;increased volume and decreased price&#34; characteristic may signal that the overseas supply-demand structure has not significantly improved. Considering the recent domestic &#34;anti-involution&#34; call and the stable growth expectations of many downstream industries in coal, the subsequent expectations for coal demand still have uncertainties. Whether the divergence between domestic and imported coal price differences will continue to drive a recovery in import volume remains to be seen.
Recommendations: As coal prices continue to rise beyond expectations, the performance recovery of coal stocks is anticipated. Key stocks to watch include Huayang Co., Ltd., Jinkong Coal Industry, Shanmei International, Lu'an EED, Shanxi Coking Coal, Pingmei Shenma, and Huaibei Mining, among other elastic targets; the allocation value of leading coal companies such as Shaanxi Coal and China Coal Energy remains high.
Risk Warning: Domestic demand may fall short of expectations, domestic supply may significantly increase, and international coal prices may decline sharply

601225

601001

600348

601699

601898

01898

Shanxi Securities released a research report indicating that the trend of shrinking imported coal has slowed down, with July imports down 22.94% year-on-year but up 7.78% month-on-month. Domestic coal prices have stabilized and rebounded due to a reduction in internal competition, and the contraction in raw coal production has increased import demand. Although the import volume has increased, prices have not risen accordingly, indicating that the overseas supply-demand structure has not significantly improved. Pay attention to the performance recovery potential of coal stocks such as Huayang Co., Ltd. and JHSCIC

Zhitong

SHCI

JHSCIC

HYGF

Lu′an EED

China Coal Energy

CHINA COAL

Shanxi Securities: The trend of shrinking imported coal volume is slowing down, and future import increments remain to be observed