activisionblizzardblockchain| Coking coal tax rate in Shanxi Province increased by 10%: coal companies 'tax burden increased, output decline narrowed, and import growth slowed down

News summary

The main contract for coking coal futures rose 3activisionblizzardblockchain.04%activisionblizzardblockchainIn April, China's raw coal output fell, imported coal increased, and Shanxi Province raised the coal resource tax rate. The manufacturing PMI shows a recovery trend, with tight coking coal supply expected to support prices, and it is recommended to absorb on dips.

Newsletter text

[Coking coal market dynamics] The night coking coal market performed strongly, with the main contract recording 3activisionblizzardblockchainThe final closing price reached 1,778.5 yuan/ton with an increase of.04%.

[Global Manufacturing News] The global manufacturing PMI in April was 49.9%, down from the previous monthactivisionblizzardblockchainThe increase was 0.4 percentage points, still slightly higher than the average level in the first quarter.

[Overview of China's Coal Production] In April 2024, China's raw coal output reached 371.665 million tons, a year-on-year decrease of 2.9%, a contraction of 1.3 percentage points from the decline from January to March.

[Coal Imports] In March, China's total import of coking coal was 9 million tons, a month-on-month increase of 14.37% and a year-on-year decrease of 1.8%. The main sources of growth were Mongolia and Russia.

[Impact of tax rate adjustment] Shanxi Province has adjusted the resource tax item and rate table, and increased the coal tax rate, effective from April 1.

[Coal import growth slows down] From March to the end of the first quarter, China's total imports of coal and lignite reached 115.897 million tons, a year-on-year increase of 13.9%, although the growth rate slowed down.

[Manufacturing and power generation growth] In the first two months of 2024, China's power generation and thermal power generation increased by 8.3% and 9.7% respectively year-on-year, indicating that the manufacturing industry has resumed its development trend.

[Market Supply and Demand Analysis] Due to the compression of steel mills 'profits and the first round of downward adjustments in coke prices, the supply side of the coking coal market is expected to be loose. However, positive developments in real estate and infrastructure have boosted market expectations for total domestic steel demand.

[Trading Strategy] Considering the limited supply of main coke and the rebound in hot metal output, there is room to increase production in the coking coal market, and the medium-and long-term trend of the main contract is strong. It is recommended that investors seize the opportunity to buy on dips.