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Feb.27.2020 1USD=7.0126RMB
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Market of Coal Producing Areas in Inner Mongolia from the Epidemic

//en.steelhome.cn [SteelHome] 2020-02-14 15:48:01

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Since the outbreak of the novel coronavirus, measures of prevention, control and quarantine were carried out in China. Inner Mongolia has confirmed 54 infection cases of the novel coronavirus pneumonia, and Ordos city of Inner Mongolia, the main thermal coal producing area, has confirmed 11 infection cases. Since the virus spread all over the world, enterprises in each and every region postponed their day for work resumption based on transmission modes and latent phase of the disease. Gradually, the epidemics impact on coal market was laid bare.

First, the number of coal mines resuming production in producing areas is small, and coal supplies are tight. Take Ordos for an example, Ordos has 64 coal mines producing coal but the operating rate was 21.2%. Although the operating rate in main producing areas kept increasing, the overall figure was at a low level. The coal production at coal mines resuming production amounted to 0.346 billion tons.

Second, in terms of railway and highway of producing areas, the traffic volumes dropped on year. On the one hand, traffic volumes of railway declined. From February 3 to 9, 2020, traffic volumes at six parks collected by Inner Mongolia Coal Exchange Center registered 0.804 million tons, down 940,000 or 10.5% MoM, or down 46% YoY. The inventory at parks totaled 0.739 million tons, down 0.36 million tons or 32.7% MoM, or down 27% YoY.

On the other hand, truck transportation got struck. Owing to the emergence of infection cases of the epidemic in Ordos, citizens throughout the city were self-quarantined at home to prevent community transmission, and governments controlled the traffic flow strictly, such that trucks from other provinces were inaccessible.

Third, work resumption at coking plants and steel mills was also limited. As demand and supply in the market was low, the impact of the delay of work resumption cannot be ignored.

Affected by the epidemic, price in producing area rose. And as the prevention and control of the epidemic ends, the price will gradually return to normal. Nevertheless, the duration and the impact of the epidemic on the imported market thereof as well as the progress of de-inventory will have more or less impact on coal market in the future.

(To contact the reporter on this story: myron.liu@steelhome.cn or 86-21-50582062)
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