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China coal supplies to tighten this winter on import curbs, strong demand By Reuters

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© Reuters. FILE PHOTO: Coal is unloaded onto large piles at the Ulan Coal mines near the central New South Wales rural town of Mudgee

By Muyu Xu and Gavin Maguire

BEIJING/SINGAPORE (Reuters) – China’s coking and thermal coal markets are set to tighten over the remainder of 2020 as stringent import restrictions curb supply at a time of robust demand from heavy industry, and with the winter heating season about to kick in.

China, the world’s top coal consumer, reportedly informed key buyers to avoid Australian coal last week, part of a broader move to limit imports that also inflamed already-fraught trade ties between Beijing and Canberra.

Australia supplied over 40% of China’s total coking coal imports in 2019, and about 57% of its thermal coal.

Graphic – China’s coal imports origins: https://fingfx.thomsonreuters.com/gfx/ce/jbyvrxjebve/coal%20origins.JPG

Chinese authorities have since 2018 tried to curb coal imports using an unofficial quota system that caps purchases in an effort to support domestic miners.

The measures have proved effective, with domestic prices since trending higher and currently approaching record premiums to international coal benchmarks.

Graphic – China vs international coal prices: https://fingfx.thomsonreuters.com/gfx/ce/nmopaynykpa/ChinavsInternationalCoalPrices.png

Over the first three quarters of 2020, China brought in 239.43 million tonnes of coal, or about 80% of 2019’s full-year total.

Domestic output however has been slow to expand amid intensifying mine safety inspections following over 100 coal mining accidents this year, and an ongoing campaign to shut outdated sites.

Graphic – China coal and coke production: https://fingfx.thomsonreuters.com/gfx/ce/dgkpljgjgpb/ChinaCoalCokeOutput.png

The country also lacks sufficient quantities of metallurgical, or coking, coal required by its massive steel sector.

“China is unlikely to become self-sufficient in coking coal, as domestic coking coal is generally low quality,” said Jefferies (NYSE:) analyst Christopher LaFemina in a note.

Traders and analysts say some key coal consumption areas, such as the northeast, where winter is about to set in, and the south, where power plants are far from coal mining hubs, may face a supply crunch if imports remain tightly restricted.

“We have huge pressure to ensure sufficient coal supply during winter season, but there is not enough import quota, and domestic supply may not be adequate,” said a Beijing-based coal trader at a state-owned power plant.

Analysts also expect more robust demand from heavy industry this winter as Beijing loosens emissions restrictions while it tries to spur economic growth.

He Lei, a coal analyst from Huaan Futures, estimates the looser environmental curbs could result in steel production cuts of about half the level seen last winter, or about 60,000 tonnes per day.

Inventory of coking coal at major Chinese ports hit an 18-month low of 3.5 million tonnes as of Oct 9, according to data compiled by Mysteel consultancy.

Thermal coal stocks at four major ports in northern China are at around 10.9 million tonnes, a level last seen in mid-June.

Graphic – China imported coal stocks held at major ports: https://fingfx.thomsonreuters.com/gfx/ce/yzdpxaoarvx/ChinaCoalStocksatPorts.png





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Commodities

Looking To Buy Heating Oil – Growing Your Money

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Looking To Buy Heating Oil

Source: Getty Images

Heating Oil Futures—Heating oil futures in the December contract is trading higher by 120 points at 1.1785 breaking a 3-day losing streak as prices are still hovering right near a 6 week high.

I have not talked about this commodity for quite some time, but I do believe that a possible bottom has been formed as I will be recommending a bullish position if prices break the October 8th high of 1.2050 while then placing the stop loss under the October 2nd low of 1.08 as the risk would be around $5,000 per contract plus slippage & commission as this is a large contract.

Heating oil is trading above its 20 day but still slightly below its 100 day moving average as prices have been stuck in the mud over the last several weeks, as we enter the highly volatile winter season when the volatility generally can have tremendous spikes due to extremely cold weather conditions especially out in the Eastern part of the United States so look to play this to the upside as I believe the commodity markets look very strong. 

TREND: MIXED–HIGHER

CHART STRUCTURE: IMPROVING

VOLATILITY: AVERAGE

 

 

 

If you are looking to contact Michael Seery (CTA—COMMODITY TRADING ADVISOR) at 1-630-408-3325 I will be more than happy to help you with your trading or visit www.seeryfutures.com

TWITTER—@seeryfutures

 Email: mseery@seeryfutures.com
If you’re looking to open a Trading Account click on this link www.admis.com

 

 

 

There is a substantial risk of loss in futures and futures options. Furthermore, Seery Futures is not responsible for the accuracy of the information contained on linked sites. Trading futures and options is Not appropriate for every investor.



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U.S. to probe aluminum foil imports from five countries By Reuters

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© Reuters. First post-lockdown cabinet meeting in London

WASHINGTON (Reuters) – The U.S. Department of Commerce will investigate aluminum foil imported from Armenia, Brazil, Oman, Russia and Turkey for potential dumping or unfair subsidies, it said in a statement on Tuesday.

The department said it would take up the probe following a petition from an industry trade group as well as three of its member companies.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.





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Silver Higher 3rd Day In A Row – Growing Your Money

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Silver Higher 3rd Day In A Row

Silver Futures—Silver futures in the December contract is trading slightly higher for the 3rd consecutive session up another $0.20 at 24.90 an ounce looking to break out to the upside in the coming days ahead. The chart structure is starting to improve on a daily basis therefor the monetary risk will start becoming more in your favor next week as I will be recommending a bullish position if prices close above the 25.71 level while then placing the stop-loss under the September 24th low of 21.81 as an exit strategy.

The risk on that trade would be around $20,000 per large contract, however the risk on a mini contract would be $4,000 plus slippage and commission as silver is an extremely high-risk trade as the contract is extremely large controlling $5,000 ounces or 1,000 ounces on the mini contract. Fundamentally speaking support from a weak dollar and optimism U.S lawmakers will agree on a debt-fueled pandemic stimulus package is adding support in the short term.

The chart structure is starting to improve on a daily basis therefor that tremendous risk will be reduced so be patient and wait for the breakout to occur as that could happen tomorrow or it could happen in 2 weeks as the precious metals across-the-board look strong today and look to move even higher. Silver prices are trading above their 20 and 100 day moving average as the trend is higher although we have been stuck in a 4-week consolidation pattern, but I don’t think that situation is going to last much longer so look to play this to the upside.

TREND: MIXED–HIGHER

CHART STRUCTURE: IMPROVING

VOLATILITY: HIGH

 

 

If you are looking to contact Michael Seery (CTA—COMMODITY TRADING ADVISOR) at 1-630-408-3325 I will be more than happy to help you with your trading or visit www.seeryfutures.com 

 

TWITTER—@seeryfutures 

 

 Email: mseery@seeryfutures.com

If you’re looking to open a Trading Account click on this link www.admis.com 

 

There is a substantial risk of loss in futures and futures options. Furthermore, Seery Futures is not responsible for the accuracy of the information contained on linked sites. Trading futures and options is Not appropriate for every investor.

 



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