The ongoing maintenance to China's coal-dedicated Daqin railway will lend support to the coal trucking market that has been squeezed by the government's increasingly tough environmental protection policies.
The autumn maintenance to Daqin line, which started on October 25, will last for 22 days until November 16, three hours each morning over 9:00-12:00. It previously planned to last 24 days over October 10-November 3.
Maintenance will also be carried out on Qiantang (Qian'an-Tangshan) and Jingbao (Beijing-Baotou) lines at the same time.
Trucks are expected to fill a large part of the void resulted from the maintenance. Data showed Daqin's daily coal transport volume was nearly 1.25 million tonnes on average in September, up 25.85% from a year ago.
Analysts expected Daqin to deliver 420 million tonnes of coal in 2017, compared to 351 million tonnes last year. Total transport reached 322.20 million tonnes in the first nine months, up 33.29% from a year ago.
Coal stocks at Qinhuangdao port had declined to 6.89 million tonnes on October 30 from as high as 7.45 million tonnes on October 23, two days before the start of maintenance, showed data from industry portal sxcoal.com.
The postponed maintenance concurred with the start of winter heating in northern China. More end users had to use trucks to build up stocks for the winter, prompting a rise in truck freight.
Data showed the freight rate for coal trucks from Shuozhou (Shanxi) to Cangzhou (Hebei) increased 5 yuan/t to 130 yuan/t on October 26. Freights on other routes also climbed up to various degrees, ranging 5-10 yuan/t.
So far this year, the coal trucking market has been hit heavily by environmental protection policies – diesel-powered trucks were totally banned at Tianjin port before May 1, and all the other Bohai rim ports implemented similar bans in the end of October.
Some other policies or measures also aggravated the cost burden of truck drivers. On one hand, more trucks were idled following the ban at ports; on the other, watchdogs at all levels asked trucks to install emission treatment facilities. More stringent overloading control also greatly cut truck drivers' profit room.
(Writing by Alex Guo Editing by Harry Huo)
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