Analysis of Supply and Demand of Major Mineral Products in the First Half of 2014

At present, what is the situation of China's mining economy and the supply and demand situation of mineral products? What will happen in the second half? The China Mining Association recently organized related associations to hold seminars on the analysis of the supply and demand situation of major mineral products in the first half of 2014, and analyzed the supply and demand situation of major mineral products including coal, iron ore, ten non-ferrous metals, and gold. And formed a report.

The mining economy as a whole does not work well

In the first half of this year, affected by the slow growth of the world economy, the prices of major mineral products in China, trade and mining investment, and other indicators have shook. The output of mineral products has slowed down from last year's growth, and some industries have shown steady economic growth. This is mainly reflected in the increasingly prominent problem of oversupply in the coal market, sharp decline in prices, continued decline in the economic efficiency of the industry, further expansion of corporate losses, and a more severe situation in the coal economy; the economic operation of the non-ferrous metals industry is showing steady momentum, and is expected to be promising. The trend of stabilizing is further continued; tungsten market demand is still sluggish, prices fluctuate, exports of tungsten products have increased, imports continue to decline, economic returns have declined, and companies are in general business difficulties; iron ore market supply and demand inflection point highlights, prices into the down channel , Pressure from domestic mining companies increased; Gold prices continued to operate at a low level, and corporate profits and economic benefits were lower than in the same period of 2013; output of major chemical minerals continued to increase, inventories increased, prices weakened, and imports fell and exports increased; non-metal Apart from the increase in fluorite content and the increase in talc, the output of mineral products decreased slightly, and total demand showed a downward trend.

The output of major mineral products: In the first half of the year, the national coal output was 1.816 billion tons, a year-on-year decrease of 1.8%; the national coal sales volume was 1.727 billion tons, a year-on-year decrease of 2.1%. From January to May, the national total output of iron ore raw ore totaled 568 million tons, equivalent to 152 million tons of refined powder production, which was a year-on-year increase of 10.7%. The inflection point of supply and demand in the iron ore market was prominent. The iron production from January to May was 301 million tons, a year-on-year increase. 0.2%, equivalent to 497 million tons of iron ore demand. From January to May, the output of ten types of non-ferrous metals was 17.15 million tons, an increase of 4.84% year-on-year. The output is expected to be about 20 million tons from January to June. According to data from the National Bureau of Statistics, from January to May, the country produced 47,266 tons of tungsten concentrate, which was a year-on-year increase of 2.44%. The tungsten mine output of the whole mine was generally stable. The national gold production totaled 171.097 tons from January to May, an increase of 14.662 tons compared with the same period of last year, an increase of 9.37% year-on-year. Among them, gold mining gold completed 137.155 tons, an increase of 6.08% year-on-year; non-ferrous metal production completed 33.942 tons, an increase of 25.05%.

Non-metallic mineral products: graphite currently has a mining capacity of 12 million tons and a beneficiation production capacity of 1.2 million tons. In 2013, the output of graphite was 540,000 tons, and the output accounted for 45% of the production capacity. From January to June, the national output was 180,000 tons, a year-on-year decrease of 15%. Fluorite produced 3.96 million tons (fine powder) in 2013, and its output accounted for only 44% of the production capacity. In the first half of this year, the output was 1.98 million tons, which was basically the same as last year; the sales volume was 1.9 million tons and the inventory was 160,000 tons. Talc produced about 1.2 million tons from January to June, an increase of about 100,000 tons year-on-year.

Major chemical minerals: Phosphorite ore In the first half of the year, 190 phosphate ore mines above designated size produced a total of 54.82 million tons, an increase of 16% year-on-year, and maintained a rapid growth rate. The output of major phosphate producing provinces for the first 6 months was increase. From January to June, 88 ore-sized ore mines across the country produced 8.50 million tons of iron ore, a year-on-year decrease of 6.7%. Production in the major producing provinces of Anhui and Guangdong both declined year-on-year. From January to June, 68 potash fertilizer producers above designated size produced 2.48 million tons of potash fertilizer, which was a year-on-year increase of 6%. The major producing provinces—Qinghai and Xinjiang all showed growth momentum.

Imports and exports: In the first half of the year, imports of coal were 159.87 million tons, an increase of 0.9% year-on-year; exports were 3.16 million tons, a year-on-year decrease of 22.4%; net imports were 157.71 million tons, an increase of 2.37 million tons, an increase of 1.5%. From the coal point of view, except for the increase in imports of brown coal varieties, other types of coal have shown a downward trend. Non-ferrous metals import and export trade from January to May totaled 65.2 billion U.S. dollars, of which imports were 41.7 billion U.S. dollars, up 1.79% year-on-year; exports were 23.5 billion U.S. dollars, down 10.06% year-on-year. Tungsten exported 8002.01 tons from January to May, an increase of 12.1% year-on-year; cumulative exports from January to May totaled 426 million yuan, a year-on-year increase of 27.3%. It is estimated that the country's tungsten exports will reach 9,600 tons in the first half of the year, an increase of 8% year-on-year. Imports of iron ore continued to increase. From January to May, the cumulative import of iron ore was 386.66 million tons, an increase of 60.59 million tons, an increase of 18.8%, and the price dropped by 30%. In terms of non-metals, from January to May, 237,500 tons of talc was exported at a cost of US$61.70 million; fluorspar exports were 150,500 tons, amounting to US$44.87 million; graphite exports were 52,000 tons, amounting to US$44.36 million; light burned magnesium exports were 151,400,000. t, the amount of 31.69 million US dollars; heavy magnesium 245,900 tons, the amount of 72.1 million US dollars.

Changes in mineral prices are also not optimistic. According to statistics, on July 11th, China’s coal price index was 143, a year-on-year decrease of 17.5 points, a decrease of 18.8 points from the beginning of the year and a decrease of 79.8 points from the highest point in July 2008, a decrease of 35.2%. On the same day, the price of 5500 kcal thermal coal for Qinhuangdao was 500 yuan/ton to 510 yuan/ton, which was a decrease of 130 yuan/ton from the beginning of the year; the average price of coking coal fell 150 yuan/ton to 200 yuan/ton from the beginning of the year, a year-on-year decrease of 100 yuan/year. Ton. National coal prices have already fallen to the level of the end of 2007. The price of iron ore is also falling. The average price of imported iron ore was US$110.19 per ton in May, down by US$4.16/t from the previous period; the average price of imports in the first five months was US$121.15 per ton, down by US$14.1/t from the same period last year. On May 19, the price of imported ore fell below US$100/ton, and on June 16 it fell below US$90/ton, and the ore price showed continuous downward movement.

The non-ferrous metal price changes are ups and downs. In the first half of 2014, the prices of the six basic metals of LME diverged, and the three varieties of copper, lead and aluminum fell further from the same period of last year, while zinc, tin and nickel rebounded. In particular, zinc prices have risen by 5% in the first half of the year in anticipation of the closure of most of the world's mines.

Tungsten prices are also falling. In the first half of the year, domestic tungsten concentrate prices fluctuated between RMB 106,000 and RMB 117,500 per ton, with an average price of RMB 111,100/ton, a year-on-year decrease of 2.8%. It is worth noting that in the first half of the year, the price difference of tungsten concentrates in the highlands reached 11,500 yuan per ton, with the largest drop of 9.79%. The price trend of APT is the same as that of tungsten concentrates. In the first half of the year, the average price of APT was 172,000 yuan/ton, down 6.51% year-on-year.

With the explosion of demand for gold jewelry and the weakening of speculative factors in the derivatives market, gold prices have begun to stabilize. The international market price of gold has been fluctuating between US$1,200/oz and US$1,400/oz since the beginning of the year. From January to May, the cumulative volume of all gold varieties on the Shanghai Gold Exchange totaled 5,397.655 tons, an increase of 22.34% year-on-year; the cumulative turnover of all gold varieties was 1,388.255 billion yuan, an increase of 3.2% year-on-year. The cumulative turnover of the Shanghai** Exchange gold ** contract was 19,752.86 tons, an increase of 240.19% year-on-year; the cumulative turnover was 510,229.89 billion yuan, an increase of 192.94% year-on-year.

The prices of major non-metallic ore and major chemical minerals continue to fall. In the first half of the year, the price of light burned magnesium was 660 yuan/ton, down 5% year-on-year; the price of heavy burned magnesium was 750 yuan/ton, down 5% year-on-year; the price of molten magnesium was 5,000 yuan/ton, down 5% year-on-year. The price of ordinary fluorite blocks was 1600 yuan/ton to 2,000 yuan/ton, down 10% year-on-year; the price of fine ore was 1650 yuan/ton to 1800 yuan/ton, down by 10% year-on-year. The price of asbestos was basically the same as last year. The price index of phosphate rock in June decreased by 14.4 year-on-year, down by 1.1% from the previous month, and the price was around 450 yuan/ton; * The iron ore decreased by 2.6, 0.2% from the previous month, and the price was about 320 yuan/ton; the potassium chloride decreased by 26.2% from the previous year. Decline 0.5, the price is about 2140 yuan / ton.

The situation is not optimistic and the pressure on the downside is high

Coal industry: In terms of domestic demand, in the first five months of this year, hydropower, nuclear power, wind power and other non-fossil energy sources maintained double-digit growth, while thermal power growth was only 4.2%. With the continuous improvement of environmental protection and governance and the optimization of energy structure requirements, the proportion of fossil energy consumption will gradually decline, and it is expected that the coal consumption will be reduced by more than 20 million tons in 2014. At the same time, due to the oversupply of the international coal market and low coal prices, coal imports may continue to remain high. In general, the contradiction between the slowing of coal demand and the release of coal production capacity in the second half of 2014 has become increasingly prominent. The downward pressure on prices may continue to increase and coal companies will be more difficult to manage.

Non-ferrous metals industry: China's non-ferrous metals production is expected to grow steadily in the second half of the year, but the growth rate has declined; the global non-ferrous metals are still showing a pattern of oversupply, but investment continues to accumulate in processing; non-ferrous metals have excess capacity, production As the cost increases, the pressure to reverse the decline in the profit of the non-ferrous metals industry in the second half of the year will remain significant. The price of non-ferrous metals will show a downward trend, but there are differences in the price changes of various metal species, especially the prices of metals such as lead, zinc and nickel are expected to continue to rise. Aluminium prices are supported by cost and the price has risen in the first half of the year.

Tungsten: From the perspective of supply, the production of tungsten concentrates has increased as a result of technological transformation projects implemented through the integration of resources that have been gradually put into production, and the combined recovery of associated tungsten, low grade tungsten, and tungsten tailings has increased. On the other hand, due to the depletion of some tungsten ore resources, the output of tungsten concentrates will decrease. The superposition of two factors will continue to maintain the balance of supply of tungsten in the second half of the year. From the perspective of tungsten ore demand, the recovery of the global economy will help drive the growth of tungsten ore consumption, and the successive production of domestic new and technologically modified downstream tungsten smelting and processing projects, especially the development of strategic emerging industries and high-end equipment manufacturing industries. Continue to pull and stabilize tungsten consumer demand. Therefore, the total amount of tungsten mining in China continued to remain stable in 2014, and the tungsten market price is unlikely to fluctuate significantly, and the overall stability has increased.

Iron and steel and iron ore: Domestic demand, except for a few industries in the automobile and shipbuilding industries, has performed well. Other industries have performed generally, and have even declined. It is expected that crude steel production will remain high in the second half of the year, the growth of steel demand will slow down, and the contradiction between supply and demand in the market will be prominent. Raw material prices will fluctuate weakly. If crude steel production remains high, it will be difficult for steel prices to rebound sharply in the short term. The iron ore output in the third quarter is expected to continue to grow. The three major mines in Australia will have 100 million tons more deliveries than last year. New production capacity will be gradually released. The global iron ore market is in oversupply and the port inventory continues to be maintained. High, it is expected that there will still be room for falling iron ore prices in the second half of the year.

Major chemical mineral products: The output of phosphate ore and potash fertilizers for the major chemical minerals in 2014 continued to increase, but the growth rate will further slow down. * Iron ore output was unchanged from previous years. Specifically, the output of phosphate ore still exceeds 100 million tons, the output of potash fertilizer will reach 5 million tons, and the output of iron ore will continue to be maintained at about 17 million tons. The supply of the market is sufficient, prices are relatively stable, and the pattern of weak consolidation is still maintained.

There are outstanding problems and need to respond actively

In general, the prices of major mineral products in the first half of this year continued to decline. Many mineral products prices are already close to the cost price or even lower than the cost price, causing serious losses for the company. The loss of the industry continues to expand, and the survival of some enterprises is facing difficulties. .

The problems in the coal industry are mainly reflected in the “Four Highlights”: First, the contradiction between the slowdown in coal demand growth and advancement of capacity building, and the increase in imported coal are becoming more and more prominent; second, the decline in coal prices, the significant reduction in benefits, and the The contradiction of heavy burden has become more and more prominent; Third, the contradiction between the adjustment of the industrial structure and the difficulty of the withdrawal of coal mines has become increasingly prominent; Fourth, the contradiction between the difficulty of sales of enterprises, the shortage of funds, and the safe production of coal mines, and the stability of mining areas have become increasingly prominent. Suggestions: First, to further strengthen aggregate control and control overcapacity; Second, actively promote the implementation of policies such as taxation and supporting reforms; third, improve the coal mine exit mechanism to support the transformation and upgrading of coal enterprises; fourth, adjust import and export policies, and coal Export tariffs adjusted to the same level.

The main problems in the gold industry are the insufficient guarantee of gold resources, the shortened guarantee period for basic reserves that can be exploited, the excessive number of small mines, extensive operations, unreasonable mine layout, and the scale and intensity of mine development needs to be improved; Gold companies are more dependent on gold prices and have weaker ability to control the market and bear price risks. It is recommended that planning, policy, administrative and legal means be used to increase the barriers to entry in mines, promote resource integration, and increase industrial concentration; increase support and create a good environment; accelerate the development of the new “Golden Management Regulations” and timely Promulgated the corresponding gold import and export management regulations, and standardized management of gold processing companies.

The main problems in tungsten mines are high mining intensity, unbalanced storage and production ratios, and gradually weakened resource advantages. The comprehensive utilization of ultra-control indicators is serious. The output of tungsten mining enterprises is free from control indicators and the supervision is weak; the industrial concentration is low, and the development quality is low. The efficiency is not high. Recommendations: First, formulate and improve industrial regulatory policies and regulations, establish and improve the tungsten industry's effective management and control mechanisms and methods, and coordinate the management of tungsten strategic resources such as exploration and extraction, smelting and processing, market sales, and import and export trade. The second is to strictly manage the management of aggregate control indicators, strictly implement the regulations of the Ministry of Land and Resources on the protective mining of specific minerals, improve the implementation of the current regulatory policy, improve the comprehensive use of total control and management policies and measures, take ministries and commissions, Standardize the circulation of tungsten ore raw materials; continue to strictly control the new mining license of tungsten mines and increase the production capacity of existing mines; carry out the rectification and rectification of selected plants in the name of mining polymetallics, exploration exploration and mining without independent mines; and study tungsten products as soon as possible. The alternative policies and measures for export management keep the export trade stable and improve the industry self-discipline mechanism. The third is to improve the quality and efficiency of tungsten industry development, strengthen the country's control of strategic rare metal resources, and encourage the creation of an integrated, capitalized large-scale tungsten enterprise group that integrates production, research, sales, and investment, to increase industrial concentration and improve The capital operation strength of large-scale tungsten enterprises and the competitiveness of international market; Continue to promote the integration of tungsten resources, continue to rectify the mining order around the tungsten mining area, promote the scale, intensive, save tungsten mining, promote ecological civilization, green mine construction , To enhance the quality and efficiency of tungsten industry development.

The problem with chemical mines is that, starting in 2013, trials of phosphate rock resource tax in Hubei province were levied. The 10% tax rate has a great impact on enterprises, pushing up the production cost of phosphate fertilizers, which is not conducive to the development of phosphate mining enterprises and agriculture. Not conducive to the use of low-grade phosphate rock resources and related industries continue to develop. It is recommended that the national fiscal and taxation departments reflect the comprehensive utilization of resources in the collection of resource taxes, use the tax rate leverage to support the application of new technologies and the comprehensive utilization of resources; at the same time, all fees and charges outside the policy should be halted to safeguard the legitimate rights and interests of phosphate mining companies. .

One of the main problems of rare earths is that the overcapacity is serious. At present, the release of production capacity has only reached 1/4 to 1/3, and 2/3 to 3/4 production capacity has not been released. Second, the phenomenon of poor dispersion of mining companies still exists. 40,000 tons to 50,000 tons of rare earth originate from the index mining. It is suggested to strengthen the coordination between the ministries and commissions on the allocation of rare earths and the supervision of the implementation of indicators. As far as possible, policies should be introduced to encourage and support the use of rare earths and expand the application of rare earths in China.