1. Overview
of national and regional market (1) National market: demand is nearing the end, the market fluctuates
in a narrow range. In December, the temperature continued to drop, rain and snow were frequent in many areas, a small number of projects were rushed in some areas, and the overall downstream demand was nearing the end; On the supply side, most areas in the north are in the winter peak stagger stage, while many provinces in the south reduce their load independently, and the supply continues to shrink. Overall, in December, the cement market continued the trend of weak supply and demand, and a small number of regions continued to shout up, but the market as a whole was calm, and cement prices fluctuated in a narrow range. The national cement price index (CEMPI) was 113.53 points at the beginning of December and closed at 113.37 points at the end of the month, up 0.21% from the previous month and down 19.96% from the previous year.
From the regional point of view, the six regions are mixed, and the range is not large. Specifically, in the southwest region, power was limited and kilns were shut down, and enterprises had limited shipments; in the northwest region, kilns were shut down at off-peak, and supply continued to tighten; in East China, the weather was mostly fine, and the rush process was slightly accelerated; in North China, the temperature was low, and downstream construction was limited; in the central and southern regions, demand was general, and sales were weak; in the northeast region, most construction sites were shut down, and the market was close to stagnation.
Figures 1 and 2: December 2023 National Cement Price Index CEMPI, Cement Price Index (CEMPI) K-line
Chart Data Source: Cement Big Data (https://data.ccement.com/)
Cost. At the end of December, the average spot price of 5500 kcal steam coal was 933 yuan/ton, down 0.53% annually and 21.27% year-on-year. Since December, although the daily consumption of power plants has increased under the influence of low temperature weather, it is difficult to release the demand for the off-season operation of non-electric industries; on the supply side, except for a few coal mines temporarily suspended production due to low temperature, rain and snow, most of them are in normal operation, and the overall supply is stable. On the whole, the supply and demand were general, and the coal price fluctuated in a narrow range, and finally closed down slightly. At the end of the month, the cost of coal per ton of cement was about 91.34 yuan/ton, which was 0.49 yuan/ton lower than that at the end of November, and the cost pressure was slightly reduced. At the end of December, the cost price difference between cement and coal was 202.84 yuan/ton, up 0.56% from the previous month, and the price difference between cement and coal continued to expand. In terms of
benefits, the average price of power coal in December was 946.81 yuan/ton, down 0.55 yuan/ton annually, the average production cost of cement per ton decreased slightly, the average price of cement in December was 343.99 yuan/ton, up 7.24 yuan/ton annually, the price of cement rose and the pressure of production cost decreased. It is expected that the profits of the cement industry will improve to a certain extent in December.
Figure 3: Cement price, coal cost and price difference in December 2023 (yuan/ton)
Data source: cement big data (https://data.ccement.com/)
