Societe Generale Securities: Coking coal supply-side tightens, industry prices are expected to rise

The Zhitong Finance App learned that Societe Generale Securities released a research report saying that looking ahead to the “15th Five-Year Plan,” global coking coal supply is weak and demand is strong, production trends are declining, demand is generally rising, prices are expected to rise, costs are expected to drop, and performance is expected to improve markedly. The price center of thermal coal is expected to be 800-900 yuan/ton. Considering the contraction in coking coal supply, the coking coal/thermal coal ratio will increase to about 2.5-3 times, and the price center of coking coal will increase to about 2,400 yuan/ton, and the price range is 2000-2,800 yuan/ton. Maintain the industry's “Recommended” rating.

Societe Generale Securities's main views are as follows:

Domestic coking coal production is declining, and overseas coking coal supply is unstable

The accident and safety supervision policies in Shanxi affected coal production. In June-July, the country's raw coal production decreased by 9.7% and 10.1%, respectively. Among them, Shanxi Province fell 31.5% and 35.8% year on year, respectively; after the Inner Mongolia coal mine accident in 2023, coking coal production declined and continued to be low. Overseas supply is unstable, customs clearance in Ganqimodu has declined, and inventories have declined as a result.

Global coking coal supply shrinks, with limited growth in key coal-producing countries

The world expects coking coal production CAGR to be -0.7% from 2025 to 2030. Among them: China is affected by national safety supervision policies and resource exhaustion, and domestic coking coal supply is expected to decline; Russian coal companies generally lose money and policies are difficult to bail out, and coking coal supply is expected to shrink; Australia's coking coal costs are high, some mines have withdrawn, and coking coal supply is expected to shrink; Mongolia's main coking coal supply is limited by resources and mining construction.

Global steel demand is improving, which is expected to support coking coal demand

The world expects a CAGR of crude steel production of 1% from 2025 to 2030. Among them: China's coking coal consumption is high, and demand is expected to remain resilient; other developing countries are contributing, and India is expected to increase steel demand, driving coking coal consumption; ASEAN expects strong steel demand to drive coking coal demand; the Middle East and Africa have a small steel production base and high potential for demand growth, driving coking coal demand.

Key investment points

Shanxi is the main producer of coking coal, and safety inspections are expected to affect production. The production of main coking coal and coking refined coal in Shanxi Province accounts for a high share of the country. In July 2026, the country's raw coal production decreased by 10.1% and 35.8%, respectively, over the same period last year.

Global coking coal supply is weak and demand is strong, and emerging countries are contributing increasingly. Global coking coal supply is shrinking, demand is under pressure in the short term and improving in the long term. Long-process steelmaking in developing countries is contributing to increased demand, and overall supply is weak and strong.

Domestic coking coal stocks are low, and it is expected that coking coal will continue to go to storage. Coking coal stocks are low. As of 2026/8/18, coking coal stocks fell 4.7% compared to the same period last year, a new low for the same period in the past 6 years.

The market value of tons of coal is low, reducing costs and raising prices to improve profits. Listed coking coal companies have a low market value of tons of coal, and the net profit per ton of coal of high-quality coking coal companies is far lower than that of thermal coal companies, which does not reflect the scarcity of coking coal resources.

Risk warning: Overseas economic growth is slowing; massive release of coal production capacity; new technology is affecting coking coal substitution; impact of coal mine safety accidents.