Major coal miners slightly adjusted up contract prices for August shipment but revised down pit-head prices in the same month, probably an evidence of their different outlook for the market at transfer ports and production areas.
State-run Shaanxi Coal and Chemical Industry Group adjusted up August guidance price for its major subsidiaries by around 3 yuan/t compared with July.
The NAR 5,500 Kcal/kg thermal coal for the August shipments is offered by Northern Shaanxi mining Co., Ltd, at 388.5 yuan/t, and Huangling Mining Group, at 423.5 yuan/t and Shaanxi Bingchang Mining Group, 429 yuan/t, FOB basis with VAT, all rising 3.25 yuan/t month on month.
The prices of NAR 5,000 Kcal/kg coal were up 2.95 yuan/t to 381.82 yuan/t and 361.85 yuan/t respectively at Hancheng Mining Co., Ltd and Chenghe Mining Co., Ltd. The NAR 4,800 Kcal/kg is offered 2.84 yuan/t higher, at 361.15 yuan/t by Tongchuan Mining Co., Ltd.
China Energy Investment Group, the country's top coal mining company also known as CHN Energy or Shenhua, also increased its price for most grades of self-produced coal by 4-5 yuan/t.
The upward price adjustments reflect some optimism among major miners over utilities' purchases in the current month, especially when import curbs still present no signs of lifting.
August is typically the hottest month in China, with large consumption of electricity.
On August 3, State Grid's power load reached a record high of 875 GWh, with six provincial grids mainly in eastern areas hitting all-time high. The unified power load of China Southern Power Grid broke record for the seventh time this year, reaching 199.8 GWh on July 29, 7% higher than the peak load last year.
Demand for the fuel will also get support, as coal-fired power plants may increase restocking to meet high power consumption, if high daily coal burns continues to eat stocks.
In comparison, pit-head market may less sanguine. Shenhua made 4 yuan/t downward adjustment for outsourced 5,000 Kcal/kg and 4,500 Kcal/kg NAR grades, while only adjusted up 5,500 yuan/t coal by 2 yuan/t.
China Coal's Mengda Mining Co., Ltd also lowered down pit-head price by 15 yuan/t to 300 yuan/t on August 4.
This suggests coal output in the producing area will be guaranteed in general during the month, and supply is expected to continue rising. Total coal output of China is forecast to further increase to over 3.9 billion tonnes this year, according to the China Coal Transport and Marketing Association.
Yet mine-mouth demand in August may be less bright compared with ports, after it is partly offset by coal stockpiles at power plants and at ports.
(Writing by Emma Yang Editing by Jessie Jia)
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