GTHT released a research report stating that since the US-Iran conflict in March, the price gap between domestic and international markets has widened rapidly. Concurrently, rising oil prices have driven up shipping costs, leading to an inversion of domestic and international coal prices by mid-to-late March. This situation is expected to persist into April, resulting in a more significant marginal contraction in imports. It is anticipated that summer will arrive earlier nationwide this year, which would bring forward the peak season for thermal coal demand and the period for pre-summer inventory restocking. Demand has already passed its lowest point. As of April 3, 2026, the Q5500 ex-station price at Huanghua Port in northern China was 765 yuan per ton, down 3 yuan per ton (-0.4%) from the previous week. Fundamentals are expected to show marginal improvement in April, with prices fluctuating within a narrow range. Key views from GTHT are as follows:

Fundamentals are projected to see marginal improvement in April, with prices moving in a tight range. The core focus remains on the summer power demand peak starting in May. On the supply side, the US-Iran conflict since March has rapidly widened the domestic-international price gap. Higher oil prices have pushed up shipping costs, causing an inversion in coal prices by late March. This trend is likely to continue in April, leading to a greater marginal reduction in imports. Domestically, high prices have kept capacity utilization rates at domestic mines near maximum levels. However, a coal mine safety incident in Shanxi in early April may lead to stricter safety inspections, potentially causing a slight contraction in output. Combined with reduced port arrivals due to scheduled maintenance on the Daqin Railway during the off-season in April, overall supply and demand are expected to ease slightly compared to March.

On the demand side, the summer power peak may arrive earlier. According to meteorological data, temperatures in most parts of the country were 1-2°C above normal in early April. Historical patterns from 2025 suggest that a warm winter is often followed by a longer and hotter summer. Consequently, summer is expected to begin earlier this year, advancing the peak season for thermal coal demand and the timeline for nationwide inventory restocking ahead of summer. Demand has already moved past its weakest point.

For thermal coal, prices are expected to stabilize before restocking activities begin in May. As of April 3, 2026, the Q5500 ex-station price at Huanghua Port stood at 765 yuan per ton, a decrease of 3 yuan per ton (-0.4%) from the prior week. Fundamentals are anticipated to improve marginally in April, with prices experiencing narrow fluctuations.

For coking coal, although pig iron output has recovered, optimism in coking coal futures has moderated. As of April 2, 2026, the main coking coal price at Jingtang Port (Shanxi origin) was 1,650 yuan per ton, down 70 yuan per ton (-4.1%) from the previous week. Daily pig iron output reached 2.36 million tons this week, an increase of 60,000 tons week-over-week. Coking coal futures retreated from the extreme optimism seen last week, which was driven by international comparisons. The reality reflects that, despite high imports from Mongolia, domestic steel demand remains largely flat or slightly lower than the same period in 2025. Supply and demand remain relatively balanced, making it difficult to support a significant price increase.

Investment recommendations highlight that the spread of geopolitical conflicts in the Middle East in 2026 has already triggered involuntary energy shifts in regions such as Europe and East Asia. Additionally, Indonesia, the world's largest thermal coal exporter, has adjusted its export policies, leading to a certain decline in annual exports. Against the backdrop of power shortages in the United States, some thermal coal originally destined for export is being redirected domestically. These factors are tightening the global seaborne thermal coal supply-demand balance, accelerating the arrival of a tight global market and initiating a new upward cycle for coal. The report reiterates a strategic bullish outlook on the energy super-cycle over the next 5-10 years. It recommends positioning in global markets through YANCOAL AUS. For A-shares, it recommends leading companies with volume growth potential over the next five years, such as Yankuang Energy, China Shenhua Energy, China Coal Energy, Shaanxi Coal Industry, and Huayang Energy.

Risks include economic growth falling short of expectations, a large influx of imported coal, and supply exceeding projections.