Controllable impact on domestic steel supply in the short term

Issuing time:2022-01-04 16:09

Controllable impact on domestic steel supply in the short term


Many experts interviewed believe that the ban on Indonesian steel plate export will have a certain impact on global supply, but the short-term impact on China's steel supply is controllable.


"Indonesia is China's largest steel importer, accounting for about 62% of China's total steel imports. A substantial reduction in imports in the short term will disturb the market, but domestic adjustment can be moderate

According to experts, coal transportation from Indonesia to China takes about two weeks. The export ban issued by Indonesia on December 31, 2021 will mainly affect the Chinese market from mid January to mid February this year. This is just before and after China's Spring Festival holiday, and the demand for industrial coal decreases, which will make room for the demand for heating coal.


From the factors affecting Indonesia's coal supply, "Due to the influence of weather factors, Indonesia's coal production was blocked and its power coal supply was insufficient, so a short-term coal export ban was issued. China's coal market has noticed the relevant situation in November last year and fully discussed the impact of weather factors such as rainstorm in Indonesia and heavy snow in Russia on China's coal supply. At present, China's coal supply protection policy should have a plan for this emergency." Said Yuan Jiahai, a professor at North China Electric Power University.


"At present, it is the peak season of domestic demand for heating coal. Affected by Indonesia's export ban, domestic coal prices may rebound." Zhang Xucheng said.


However, he also said that since October 19 last year, China has taken many measures to guide the coal price to return to a reasonable level, the state has a firm will to regulate the coal price, and the upper limit of domestic port coal price may be about 1200 yuan per ton in the future. In this case, the coal price is determined by market supply and demand.


From the perspective of the international market, Zhang Xucheng and other interviewed experts believe that the international coal price may increase greatly in the short term, but the trend of China's coal price may also have an impact on the international market, helping to stabilize the fluctuation of international coal price to a certain extent. China's annual coal import volume of about 300 million tons is the connector of domestic and foreign markets. This can be seen from the international coal price trend after China's coal price regulation on October 19 last year.


In the long run, the tight balance between coal supply and demand is still or will continue


In addition, it is worth noting that there is still great uncertainty about Indonesia's policy of banning coal export this time.


Public information shows that at the video conference held by the Ministry of energy and mineral resources of Indonesia on January 1, relevant participants raised many questions and questions about the export ban. An official of the Ministry of energy and mineral resources of Indonesia said that a further decision would be made after reassessment of the relevant situation as early as January 5.


Zuo Qianming and other interviewed experts believe that if the implementation period of the ban is further extended, considering that Indonesia is China's largest coal importer and has a high share, it may have a great impact on China's coal supply and demand situation, or further increase the difficulty of domestic coal supply.


From a broader perspective, Zhang Xucheng believes that the shortage of coal supply is a global problem. This is mainly because, on the supply side, the willingness of coal enterprises to increase production capacity has decreased under the background of global carbon reduction; On the demand side, there is a structural imbalance between thermal power and green power. Coal supply and demand will remain in tight balance in the next few years.


As far as China is concerned, under the goal of carbon peak and carbon neutralization, coal and coal power will play an important role in bottom guarantee, regulation support and emergency standby. Zhang Hong predicts that during the "14th five year plan" period, China's total coal consumption will reach a peak of about 4.2 to 4.3 billion tons. During the "15th five year plan" period, China's total coal consumption will maintain a peak range and decline slightly, and maintain a coal import volume of about 300 million tons per year, which is conducive to the balance between supply and demand of the coal market in the southeast coastal areas.


He believes that in view of the national conditions of China's coal as the main energy, combined with the actual results of the construction of large modern coal mines in China, especially intelligent coal mines, the degree of coal mine safety has been greatly improved. We should speed up the research and establishment of China's coal mine flexible production capacity mechanism, and according to the changes of market supply and demand situation and the output of renewable energy, We will implement flexible capacity management for large modern coal mines, stabilize fluctuations in the coal market, and maintain stable supply, demand and prices in the national coal market


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