Hong Kong Stock Concept Tracking | The gradual "public utility" transformation of the coal industry is reshaping sector valuations (with concept stocks attached)
In the first half of the year, the overall supply and demand of coal remained stable, with a 12.5% year-on-year increase in imported coal. The coal industry is gradually becoming "public utility-oriented", and high dividend assets are still an important long-term investment direction. It is expected that the current round of interest rate cuts in the United States will have limited impact on domestic coal prices
In the first half of the year, the overall supply and demand of coal remained stable, with a year-on-year increase of 12.5% in imported coal.
The China Coal Industry Association released a report on the development of the coal industry in the first half of the year. During this period, the output of raw coal decreased year-on-year, while the level of clean and efficient utilization of coal-fired power significantly improved.
In the first half of the year, the output of raw coal in industrial enterprises above a designated size was 2.27 billion tons, a decrease of 39 million tons year-on-year. In June, hydropower output in China increased significantly, while wind and solar power generation grew rapidly. The electricity generated by thermal power plants decreased by 4.3% and 7.4% year-on-year respectively, leading to a significant reduction in coal consumption.
According to the Securities Research Report released by Guotai Junan Securities, the coal industry is undergoing profound changes in supply and demand structure, gradually becoming more "public utility-oriented." This also reflects the investment strategy preference in the market for high dividend-yielding assets under the backdrop of declining risk-free rates in the asset shortage environment.
Unlike global pricing for crude oil and natural gas, China accounts for 56% of global coal demand, with an import dependency of only around 10%, serving as a supplement. The fluctuations in China's coal prices mainly reflect changes in the supply and demand structure of the domestic coal industry.
Therefore, it is expected that the impact of the current round of interest rate cuts in the United States on domestic coal prices will be limited; high dividend-yielding assets remain an important long-term investment direction.
Companies related to the coal sector include:
Yanzhou Coal Mining Co., Ltd. (03668), Mongolian Mining Corporation (00975), China Shenhua Energy Company Limited (01088), Shougang Resources (00639), Yanzhou Coal Mining Company Limited (01171), Inner Mongolia Yitai Coal Co., Ltd. (01878), China Coal Energy Company Limited (01898), China Qinfa Group Limited (00866), etc