"The nine consecutive rounds of coke price declines within two months have greatly reduced the profits of domestic coking companies, which have approached the cost line and even suffered losses. Coking companies generally feel a lot of pressure."He Xiaodong, head of Henan Chemical Industry Network, told reporters reflect.
The reporter learned that the recent decline in the price of coking products was caused by the continuous decline in the price of coke. According to industry insiders, since April, domestic coke prices have continued to decline. As of the end of May, the mainstream domestic coke transaction prices fell by more than 25% month-on-month and 43% year-on-year. The drop in coke prices has caused a domino effect in the downstream of the coking product chain, and the prices of coal tar, coal tar pitch, anthracene oil, washing oil, industrial naphthalene, carbon black and other products have continued to drop sharply.
"Affected by this, the overall operating rate of domestic coke enterprises has declined. In May, the comprehensive operating rate of domestic coke enterprises was around 74%, a month-on-month decrease of 1.7%. In the middle of the year, the by-product coal tar and downstream deep-processing products quickly bottomed out and rebounded, and the coking product chain opened the mode of 'main cold and secondary heat'." He Xiaodong explained.
The main product continues to fall and find the bottom
The statistical information of Henan Chemical Industry Network shows that on June 2, the domestic coke market experienced nine rounds of decline since April, and then welcomed the tenth round of price cuts. The transaction price reached 1,840~1,930 yuan (quasi first-grade metallurgical coke), and the low-end price even dropped to around 1,700 yuan.
"Under this background, the profits of coke enterprises have fallen to the edge of profit and loss. In addition, the terminal consumption continues to be weak. Although coke prices have been lowered for ten consecutive rounds, the downward pressure remains unabated. If steel prices continue to fall, it is not ruled out that The possibility that the factory will lower the price of coke again will cause most coke companies to passively reduce production and maintain prices in the later stage, and the price of coking main products may continue to fall and find the bottom." Sun Guocheng, chairman of the labor union of Henan Pingmei Shenmashoushan Chemical Technology Co., Ltd., analyzed .
By-product continuous increase repair
The person in charge of a coking company in Inner Mongolia said that the tenth round of coke price cuts has been fully implemented, but the risk of coke price cuts still hangs over the market, and some coke companies are still below the loss line and have begun to actively reduce production. On the whole, if you want to maintain the current coke price, coke companies can only adjust the production rhythm according to the profit, so the supply of by-product coal tar is expected to decrease in the later period.
Under this expectation, coke companies around the world have sold coal tar at high prices. Since May 10, the coal tar market has rebounded rapidly. As of the close of June 2, the mainstream transaction prices in various places have risen to around 4,300 yuan, an increase of more than 55%, basically restoring the diving market in April. The strengthening of the market for by-products has also compensated some of the benefits for the continuous decline of the main products of coke companies. This drop has increased the operating rate of coke companies to a certain extent.
"Under the background of limited coal tar resources, the downstream deep processing series products have also seen a general increase, especially the relatively large proportion of coal tar pitch products has increased significantly, from 2,900 yuan in mid-May to 5,000 yuan in early June , an increase of more than 72%, laying a solid foundation for the stable start of coal tar deep processing enterprises. In addition, the prices of anthracene oil, washing oil, carbon black, industrial naphthalene and other products also rose by 37.5%, 10.3%, 7.7%, and 3.1%, respectively. The downstream industry chain of coke by-products has seen a continuous general rise in the market, and the market pattern of "mainly cold and secondary heat" began to appear in mid-May." He Xiaodong analyzed.
Insufficient demand industry continues to be weak
Data from the National Bureau of Statistics show that the business activity index of the construction industry in May was 58.2%, a decrease of 5.7 percentage points from the previous month. Among them, the new orders index of the construction industry was 49.5 percent, a decrease of 4.0 percentage points from the previous month. On the whole, due to the sluggish terminal demand and the impact of high temperature and rainy weather, steel demand continued to shrink in May. After entering June, the constraints of insufficient demand are still there, so the coking industry may continue to be weak.
"At present, the profits of coke companies have reached the edge of profit and loss, and the production enthusiasm of coke companies is average. Most coke companies have production reduction plans in the later stage, and coke stocks are in the stage of continuous destocking." Meng Jianjie, marketing manager of Zhengzhou Dayou Gas Co., Ltd. pointed out, Downstream steel mills are still in a state of loss, and the continuous reduction of coke prices has restored the profits of steel mills, but the seasonal off-season is approaching, and the possibility of steel mills lowering coke prices again cannot be ruled out. However, the general increase in the by-products of the industrial chain has boosted the morale of coke companies, and the formation of a good foundation for the future market of coke. Under the trend of meager profits or even losses of coke enterprises and the warming up of by-product deep processing enterprises, it will support the balance of production and demand in the entire coking product chain.
Industry insiders said that the current low-efficiency situation of steel mills continues, but the loss has narrowed significantly, and some steel mills have begun to resume production. At the same time, due to the slowdown in the growth rate of fixed asset investment and the continued shrinking of the manufacturing industry, the demand for steel products in June is still not optimistic. In the short term, the loose supply and demand pattern in the steel market continues, and steel prices may fluctuate weakly.
Due to the recent rapid rebound of the domestic coal tar market as a whole, the increase has reached more than 55%, and the increase in coal tar pitch has also reached 72%. From a technical point of view, if the volume and price cannot be effectively coordinated, the continued rise will also face obstacles. In addition, terminal demand has not picked up substantially, and terminal carbon and tire factory replenishment has been completed one after another. Businesses have strong resistance to high prices, so the pressure on the coking by-product chain to continue to rise in the later stage will increase. Once stagflation or decline occurs in the by-product chain, it is not ruled out that the market will make up for the decline. Therefore, it is recommended to actively pay attention to changes in the macroeconomic situation, and the impact of comprehensive factors such as coal tar pitch and carbon black markets in the steel market and coke by-product market on the entire coking industry, to avoid risks and stop losses in time. (Liu Yongming)
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