The coal market has maintained a large bull market with volume and price rising over the years. However, since May of this year, the trend has changed suddenly and the price has been lowered continuously. At present, the prices of anthracite, coking coal, and long-flame coal all over the country are generally reduced by 50-80 yuan (t price, the same below) compared with April. In some regions, the drop is even as high as 100 yuan. Coal accounted for more than 70% of the total cost of coal chemical companies. It is reasonable that after the price of coal is lowered, the cost of the chemical industry will decline, and profits will increase. but it is not the truth. “The loose coal price has indeed eased the pressure on corporate costs, but the decline in product prices is even greater. Not only can companies fail to benefit from the decline in coal prices, but the losses are even greater.†On June 25, Yin Runsheng, deputy general manager of Suihua Group, Shaanxi Coal Chemical Group This was expressed in an interview with reporters. He said that since June, Suihua Group's raw coal price has dropped by about RMB 20, and thermal coal prices have shown signs of loosening but have not substantially reduced prices. The current production of 1 ton of methanol requires approximately 3 tons of two coals (raw coal + thermal coal) and the production of 1 ton of urea requires approximately 1.6 tons of two coals. The decline in coal prices can reduce the cost of methanol by 60 yuan and the cost of urea by 32 yuan. However, after the price of coal fell, the price of methanol and urea, which lost its cost support, fell even more sharply. At present, the ex-factory price of methanol is barely maintained at 2,150 yuan, a sharp drop of 450 yuan from the highest in May; the price of urea is down by 150 yuan from the previous high point. If this situation cannot be changed in the later period, the operating conditions in the second half will be worse than the first half. "The state of the company's business has begun to deteriorate." Zhang Li, general manager of Shaanxi Coal Chemical Co., Ltd. Shaanjiao frankly stated. He told reporters that since May, the price of coking coal has fallen by about 100 yuan, and the supply is also relatively abundant. According to the calculation of 1 ton of coke produced from 1.33 tons of coking coal, the decline in the price of coking coal can reduce the cost of coke by more than 130 yuan. While coking coal prices fell, coke prices fell by more than 200 yuan. Although Shaanxi Jiao Company reduced costs through various methods such as formula coal, it still could not digest the new 50-odd spread loss. In addition, the price of methanol produced from coke oven gas has dropped from 2,500 yuan in the previous period to 2,100 yuan. This has led to a reduction in the revenue generated by the comprehensive use of resources, and the company’s hope of turning losses around the year has become even more rampant. "We can still barely maintain the production of coal prices, and now we only have to stop maintenance." Xu Xiang, general manager of Shaanxi Xixiang County Nitrogen Fertilizer Co., Ltd. reluctantly told reporters. The company is a small nitrogen fertilizer enterprise with a capacity of 60,000 tons/year of synthetic ammonia and 240,000 tons/year of ammonium bicarbonate, and is currently the largest ammonium bicarbonate producer in Shaanxi Province. In 2011, Xixiang Company achieved an output of 220,000 tons of ammonium bicarbonate and an annual average loading rate of 92%. The stable and long operation of the plant and the refinement of its management have enabled enterprises to consume only 1.3 tons of raw coal, thermal coal and power consumption of only 1.3 tons, 200 kilograms and 1300 kilowatt hours respectively, and the comprehensive energy consumption has reached the advanced level of the industry. However, due to the low value-added products, the market has shrunk severely, and raw coal prices have risen sharply. For many years, the company can only operate at low profit or even lose money. Although since May, the price of anthracite has dropped by RMB 60 and the supply is no longer tight, but the price of ammonium bicarbonate dropped by RMB 50 during the same period. According to 0.325 tons of raw coal and 0.05 tons of thermal coal, 1 ton of ammonium bicarbonate was calculated. After the price of coal fell, the cost of ammonium bicarbonate decreased by 22.5 yuan. This means that the production of 1 ton of ammonium bicarbonate now costs 27.5 yuan more than before the price of coal fell, forcing companies to start shutting down for maintenance from July. Wang Shengcai, chairman of Shaanxi Coal Chemical Group Shenmu Energy Development Co., Ltd., which is located in the hinterland of coal, also disclosed to reporters that coal prices in Yulin have generally declined since the beginning of this year, and the coal price has accelerated since May. At present, the local ex-factory price for bituminous coal is generally only 340 to 360 yuan, which is a drop of 80 yuan from April. However, at the same time as the price of coal fell, the ex-factory price of blue carbon also dropped sharply to more than RMB 800 from the previous RMB 900. It fell by more than RMB 150, resulting in production cuts and shutdowns for many coal companies, and the industry’s operating rate dropped to around 50%. Industrial losses. “When the cost rises, it is difficult to conduct and pass through, and when the price of coal falls, profits are more squeezed. This is the most prominent feature of overcapacity and structural contradictions. The only way to solve the dilemma is to cool the coal chemical industry and speed up the process. The outdated production capacity has been eliminated, and total control and structural adjustment have been unshakeably implemented, and in particular, new projects have to be strictly controlled. Otherwise, such disorderly expansion will not only affect the interests of the entire industry but also the country. "In the face of reporters, chemical experts and deputy inspectors of the Shaanxi Provincial Office of Industry and Information Technology, said Hu Haifeng. 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