WEEKLY: Run rates at China's coal wash plants slide
The drop in daily output of these wash plants was in line with the decline in their run rates, Mysteel Global noted. Over the period, their run rates dipped by 1.24 percentage points on week to average 66.93%, mainly because many washeries were inactive in processing, the survey results suggest.
Most independent wash plants reduced their operations in response to a fall in orders caused by sluggish buying from coke producers and steelmakers, survey respondents said.
As for mine-mouth wash plants, those in East China's Anhui slowed operations mainly to prevent their processed coal inventories from climbing higher. These plants reported that their internal stocks had risen steeply as their customers – dissatisfied with only a mild cut in this quarter's prices for long-term contracts coal – were tardy in fetching coal cargoes.
Meanwhile, plenty of buyers also delayed their purchases of coking coal, expecting further declines in the material's prices in the foreseeable future, market sources said.
As of April 9, China's national composite coking coal price was assessed by Mysteel at Yuan 1,524.1/tonne ($210.7/t) including the 13% VAT, down by Yuan 45.4/t on week.
All these factors caused the inventories of processed coal held by the 110 sampled plants to mount further during the survey period, with the total swelling by another 369,300 tonnes or 19.4% on week to reach a 20-month high at 2.28 million tonnes as of April 9.
Conversely, total raw coal stocks at these surveyed wash plants reversed down in tandem, thanks to rising consumption of raw coal at wash plants in North China's Shanxi province.
The survey results show that a few Shanxi coking coal mines that had halted production previously due to safety checks after accidents resumed normal production during the survey period, lifting the operations of their affiliated wash plants.
By April 9, total raw coal stocks held by all 110 plants had slipped by 2.7% on week to sit at 2.65 million tonnes, ending two straight weeks of increases, the survey data show.
Written by Irene Zhuang, zhuangailing@mysteel.com
Edited by Russ McCulloch, russ.mcculloch@mysteel.com
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