According to the monitoring of the commodity market analysis system of the business community, the auction price of the high-temperature coal tar market fell sharply this week. From April 14 to 21, the domestic coal tar price fell from 4620 yuan/ton to 3667.5 yuan/ton, and the price fell 20.62% in the cycle.
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Recently, the price of raw material coking coal has decreased, and the cost of coke enterprises entering the furnace has decreased. The overall operating cost of enterprises is relatively high, and the supply of tar is relatively loose. The prices in the downstream deep processing industry have mostly declined, with an average decline of about 4% in recent years due to the impact of profits. This has led to a strong mentality of downstream enterprises to hold down prices, and coking enterprises have offered to sell out, resulting in a sharp drop in bidding prices this week, marking the highest weekly decline in history.
On April 21, the auction of coal tar in the main domestic production areas basically ended in the week of April 21. The price of tar in the main production areas decreased by nearly 1000 yuan, and the mainstream decreased by about 800-1000 yuan/ton. The mainstream price in Shanxi region is 3510-3700 yuan/ton, with a decrease of around 950-1000 yuan/ton. In the Shandong region, it is at 3800 yuan/ton, with a decrease of around 800 yuan/ton. In the Hebei region, it is 3650 to 3700 yuan/ton, with a decrease of 900 to 950 yuan/ton. In the Jiangsu region, the price is 3800 yuan/ton, with a decrease of 800 yuan/ton.
The domestic high temperature coal tar market will perform well in 2022. The highest price in 22 years will be 6712.5 yuan/ton on November 3. With the final landing of the price in this week’s auction, the domestic average price will be 3667.50 yuan/ton, with a decline of 45.36% according to the highest price in 22 years.
Supply: The operating rate of coking enterprises has steadily increased, and the supply of tar is relatively loose
From the operating rate curve of independent coking enterprises in China from 2022 to present, we can see that after entering 2023, the operating rate of coking enterprises has continued to steadily increase, and significantly increased in mid February. According to the monitoring of Business Society, as of April 21, the operating rate of coking enterprises has been close to 80%, which is basically close to the peak season operating rate. Currently, the overall operating rate of coking enterprises is relatively high, and the supply of tar is relatively sufficient.
Demand: Although deep processed products have significantly declined, they still exist in immediate demand
Industrial naphthalene, anthracene oil, washing oil and coal tar pitch are the main commodities in the deep processing industry of coal tar. Since 23 years ago, the price of deep processing commodities has basically kept pace with the trend of tar. This week, the price of some commodities in the deep processing industry dropped significantly, especially the price of anthracene oil and coal tar pitch dropped to 1000 yuan/ton, which affected the mentality of deep processing enterprises. The profit of the deep processing industry has shrunk, and the start of the deep processing industry has declined slightly this week, Downstream industries have a strong mentality of suppressing tar prices, while coking enterprises have recently started operating well and can only sell at a lower price to digest inventory. Therefore, tar prices have plummeted this week, with a single week drop feared to hit a new historical high.
Forecast: Generally speaking, as the weather turns warmer, the coking enterprises should gradually increase to more than 80% according to previous years, and the overall supply of coal tar will be in a normal and loose state. In terms of demand, as the downstream deep processing industry experiences a sharp drop in raw material prices and profits improve, the operating rate should rise to the normal range, and there is still a demand for tar. As the 51 hour holiday approaches, most manufacturers still have stocking demand. With the support of downstream demand, the decline in tar prices is limited again, and it is expected that the future market will remain stable, with weak operation as the main trend.
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