China Coal Energy recently indicated during an institutional research session that the price of thermal coal at ports in July is expected to follow a pattern of being lower initially before stabilizing, with price fluctuations gradually narrowing. This outlook is influenced by factors including demand release from end-user power plants and the normalization of stricter regulatory oversight. The company forecasts the spot price for 5500 kcal thermal coal at northern ports to trade within a range of 795 to 835 yuan per tonne for the entire month.
The company also noted that in June, the thermal coal market exhibited characteristics of being high initially before declining and undergoing a correction from elevated levels. This was driven by factors such as the onset of the peak summer electricity consumption season in early June, strong expectations for reduced coal imports, a rebound in port inventories during the middle and late parts of the month, and relatively weak daily consumption for thermal power generation.
Regarding the recent increase in coal prices, China Coal Energy pointed out that it is primarily affected by both supply and demand dynamics. On the supply side, overall tightness persists due to the normalization of stricter regulations, limited production growth, and price inversion for imported coal. On the demand side, demand continues to grow, supported by the arrival of the peak summer season and the gradual release of inventory replenishment needs.
Furthermore, the company mentioned that, taking a comprehensive view, it anticipates the annual average price center for coal in 2024 will be higher compared to the previous year.
China Coal Energy also provided an update on its operations, stating that in the first half of the year, its commercial coal output experienced a year-on-year decline. This was attributed to factors including changes in geological conditions and increased difficulties in production organization. The company is currently actively implementing various measures to scientifically organize production and fully compensate for the output shortfall. Production in June showed a month-on-month recovery, and there are currently no plans to adjust the full-year production budget.
Concurrently, the company indicated that due to factors including significant accidents within the coal industry, the commissioning progress for the Weizigou Mine and Libi Mine projects is expected to be delayed.
In addition, China Coal Energy stated that its coking coal production is primarily sourced from its Huajin subsidiary, with an annual output of approximately 10 million tonnes. Pricing follows monthly and quarterly contracts, and recent prices have risen in line with market trends.
Regarding its coal chemical business, the company noted that with the increase in chemical product prices, it expects the gross profit margin for its coal chemical segment in the first half of the year to improve compared to the same period last year.
China Coal Energy also announced that its shareholders' meeting has authorized the board of directors to formulate and implement an interim dividend plan for 2026. The plan stipulates a distribution of no less than 30% of the net profit attributable to the parent company's shareholders for the first half of 2026, based on the lower amount calculated under Chinese Accounting Standards for Business Enterprises and International Financial Reporting Standards.
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