Coal stocks have been jumping up at southern China Guangzhou port recently, following the country relaxed coal import limits late last month.
China's top economic body National Development and Reform Commission verbally required canceling import restrictions it issued in summer by quickening coal custom clearance.
From December 14, the port's coal stocks fell back to a trough at 1.4 million tonnes and were bottoming out fast afterwards, showed data from industry portal sxcoal.com. By January 9, coal stocks rose to 2.09 million tonnes, 8.17% more than the level at the beginning of the month, and 32.92% more than December 14's low.
The port's coal stocks, bouncing back quickly within less a month, can play a big role in meeting increasing demand of the fuel in southern regions, where temperatures were slumping after hit by heavy rainfalls and households need tremendous electricity to keep warm.
Coal stocks of Guangdong Yudean Group, one of six major coastal utilities in the country, have risen greatly in the first days of January.
By January 9, the group's coal inventories totaled 2.45 million tonnes, up 18.7% from January 1, compared with 2.4% and 1.1% of Huaneng and Guodian, other two of the six utilities that mainly responsible to cover the electricity need in eastern and northern regions.
Datang and Zhedian, another two of the six, saw stocks down 3.2% and 2.9% from the month's beginning, while Shanghai Electric Power, also belong to the six, grew 47.5%, which is only 950,000 tonnes amid its small volume of stocks.
Currently, coal supply from northern production areas remains tight at northern ports, especially after a stretch of snowfalls that covered most of the northern region and caused truck transport congestion. Therefore, southern thermal power plants need the support from seaborne imports.
Combined coal stocks of the six utilities, 10.74 million tonnes on January 9, can only support consumption of less than 15 days. In fact, the latest day their stocks exceeded 15 days of use need date back to December 15, 16 days.
Low stocks forced power generators to restock and of course, accept higher offer prices. Accordingly, coal prices in both domestic and import markets are keeping on the rise.
On January 9, Fenwei CCI spot index for the domestic 5,500 Kcal/kg NAR thermal coal was assessed at 725 yuan/t, 16 yuan/t more than the month's beginning; that for the import thermal coal with the same CV at $90.5/t or 692.5 yuan/t, up $2.5/t or 22.2 yuan/t, both on FOB basis with VAT.
(Writing by Alex Guo Editing by Tammy Yang)
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