A strong cold front has brought heavy snow and plummeted temperatures in large parts of northern China over the weekends, helping drive up coal consumption and potentially demand for the material at production areas and northern ports.
Snow has blanketed many parts of Shaanxi, Shanxi, Beijing, Hebei, Henan and Shandong as well as southeastern Liaoning on Sunday (December 10), according to the National Meteorological Adminstration (NMA). Snowfall averaged 3-8 cm in these places, with some even observing over 10 cm.
Snow began falling across Shanxi province on Sunday, leading weather authorities to issue a yellow (third most serious in four color-coded levels) blizzard warning. Multiple highways have since shut down due to poor driving conditions.
Shanxi is the top coal producing province in China, providing 1/3 of the total output in the nation.
Taiyuan, the provincial capital, saw around 10 cm of snow accumulate on roads and vehicles. Sections of several major highways had closed. Police guided stranded motorists off the roads and deployed snowplows to keep traffic moving safely.
The snow raided Shandong province starting from Saturday, forcing local authories to issue blue warning for cold snap and yellow warning for road ice. On Sunday, gales warning was alarmed along the Bohai Sea coastline. In response, over 600 fishing ships returned to Dongying port for shelter.
In the early morning of December 11, the temperature in Shadong plummeted 16 degree Celsius, particularly in the northwest and central areas of the province. Local authorities are monitoring power and heat plants, ready to keep residents warm indoors.
Yulin in northwestern Shaanxi province was hit by a mix of snow and rain on Sunday which brought temperatures down by 6-8 degrees on average. Snowfall amounts met the criteria for blizzard conditions at multiple observation stations around the area.
Roads grew slippery as snow accumulated through the afternoon, reducing visibility and slowing traffic. Police controlled major intersections and sent snowplows to clear super highways, resulting in temporary closure .
Yulin is the key coal production city in China. The snow will dampen coal transport to other regions, leading to potential supply tightness in the market.
Sxcoal data showed coal outbound shipments at Qinhuangdao plummeted to zero recorded on Monday, and Caofeidian also saw a similar decline by 42.05% day on day. Market sources noted gales have closed ports since Saturday and may continue through today.
But their inbound shipments increased, by 3.38% day on day at Qinhuangdao and 12.45% at Caofeidian.
This indicates a potential boon in coal stockpiles at ports in the near term, bringing uncertainty to the market developments this week.
As of Sunday, coal stocks stood at 6.1 million tonnes at Qinhuangdao port and 12.5 million tonnes at Caofeidian port, with minor changes over the previous week.
The NMA forecasts two other snowfalls in the north this week, with the coverage extending further south.
(Writing by Alex Guo Editing by Harry Huo)
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