As per the latest updates, a train at Daqin – China’s busiest coal-transporting rail line, got derailed yesterday near Xiazhuang station which is likely to disrupt coal supplies to Qinhuangdao port in north China.
The 653 kms Daqin railway line connects the coal-producing heartland Shanxi province to Qinhuangdao port in north China.
This disruption would temporarily reduce supplies to coastal power plants near Qinhuangdao port, indirectly providing support to China’s domestic Fob port price. Chinese domestic coal prices of NAR 5,500 kcal/kg coal are currently assessed around RMB 550-554/t fob ports in north China.
As on 17 Aug’20, coal stock at Qinhuangdao port stood at 5.86 mn t. In the previous week, the coal stock at port stood an all-time high at 6.05 mn t since 25 Apr’20. The derailment could possibly further reduce coal supplies at the port.
Scheduled maintenance for Daqin is also due to begin in September. This could again curb supplies at a time when customs restrictions are curtailing imports.
In the month of June, the quantity of coal transported on China’s major coal-hauling Daqin railway line reached an all-time high at 23 mn t per day, up by 8.9% y-o-y amid high demand during summer and increase in the number of rail cars used on the line.
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