After the Spring Festival, the glass industry has made a good start in the off-season. A number of glass manufacturers reappeared the price increase letters, ranging from 2 yuan / heavy box to 5 yuan / heavy box, involving Hebei, central China, East China, South China and other regions.
Gao Ling, an analyst of Longzhong information industry, told the financial associated press that before the Spring Festival, some non mainstream enterprises issued price increase letters at the beginning. At present, large enterprises are also following up. Manufacturers often raise prices before the end of February. This is a practice in previous years. Real estate has a great impact on glass supply and demand. The key to follow-up is whether demand can be released in time, In view of the strong upward mentality of production enterprises, the price may still have a slight upward trend.
Another brokerage agency believes that the recent real estate industry has been stimulated by favorable policies from the policy level, the pressure of enterprise funds has been alleviated, and the completion of the project has been guaranteed, which will drive glass consumption. At present, the price of float glass is close to the bottom, and there is more room for repairing the fundamentals of the industry.
the off-season is not light, and the forward and current prices rise together
The spot price of glass kept rising during the Spring Festival. Glass production enterprises in Shandong, Hebei, Henan and other regions have issued price increase notices during the Spring Festival, most of which are 2 yuan / heavy container. After the Spring Festival, the price increase will also be increased to 3-5 yuan / heavy container.
According to the price increase letter issued by a glass manufacturer in Liling, Hunan Province, in order to absorb the pressure of sharp rise in costs, the first-class white glass products have increased by 2 yuan / heavy container since February 8. The price of glass futures rose by more than 33% from the beginning of the year to February 2021 in combination with the trend of the main contract of more than 1705 tons since February 2021.
"Manufacturers generally raise prices to strengthen market confidence and promote downstream procurement and preparation after the Spring Festival". Gao Ling believes that from the current state, the sales strategy of glass manufacturers is relatively successful. Under the joint action of positive sales policies and the rapid recovery of terminal orders, the confidence of the middle and downstream markets is also stabilizing at the same time.
Zhuzhou Kibing Group Co.Ltd(601636) a person from the Securities Department told the financial associated press that it is normal for manufacturers to raise or lower prices. The current general rise of glass may be related to the loose wind direction of the recent real estate policy regulation. Including the recent clarification that the loans related to affordable rental housing projects are not included in the concentration management of real estate loans, we may not be so pessimistic about real estate.
Boosted by the price rise, the A-share glass sector stabilized and rebounded as a whole after the year, Zhuzhou Kibing Group Co.Ltd(601636) (601636. SH) has increased by 12% so far this week, Shanghai Yaohua Pilkingyon Glass Group Co.Ltd(600819) (600819. SH) has increased by 6.51% and Csg Holding Co.Ltd(000012) (000012. SZ) has increased by 6%.
there are differences on whether the industry can continue to rise due to pessimistic expectations or repair
Price fluctuation has become a key factor affecting performance. According to the reporter's statistics, at present, a number of glass related companies have issued performance forecasts, Zhuzhou Kibing Group Co.Ltd(601636) it is expected that the net profit in 2021 will increase by 121.35% to 144.65% year-on-year; Csg Holding Co.Ltd(000012) it is expected that last year's net profit increased by 66% to 109% year-on-year. It is worth mentioning that in the fourth quarter of last year, due to the impact of factors such as the real estate capital chain, the demand for glass decreased, the price of Q4 glass decreased, and the single quarter performance growth of some glass manufacturers changed from positive to negative.
For the judgment of glass price trend in the later stage, Cui Yuping, an analyst of Zhuo Chuang information glass, told the financial associated press that since January, the market off-season is not light, traders are actively preparing goods, and the inventory of float factory has been reduced. The inventory expectation of float factory in most regions after the festival is relatively normal. After the festival, small and medium-sized processing plants have replenished successively, and the market price probably rose in the early stage after the Spring Festival. However, the improvement of terminal funds may be relatively slow, and the medium and long-term focus on the actual orders of downstream processing plants. In addition, attention should also be paid to the impact of the construction progress and logistics of the downstream and terminal after the festival in the northern region.
From the supply side, the elasticity of capacity change in 2022 is relatively strong, and the profit is still the biggest factor for manufacturers to consider whether to cold repair. At present, the profit situation is OK, and the cold repair of most production lines continues to be postponed. In addition, 14-15 lines are still planned to be ignited in the year, and the capacity is still expected to increase slightly in 2022. On the demand side, the improvement of capital will benefit the completion of the real estate, but the intensity of capital improvement and the actual situation of project progress need to be considered.
Orient Securities Company Limited(600958) according to the analysis, the glass price is expected to climb after the Spring Festival, and it is optimistic about the investment opportunity of bottom building and recovery of the industry. The agency believes that the current float glass price is close to the bottom. With the arrival of the cold repair peak in the first half of the year and the demand peak in the second and third quarters, the price stands at a high point in the third quarter, and there is more room for repair of the industry fundamentals.
However, there are still market differences. According to the latest data, glass enterprises did not have obvious maintenance during the Spring Festival, and only one production line was reduced, with a weekly output of 872300 tons, nearly 4% higher than last year. Some insiders believe that the latest inventory data has not been made public, but considering that the inventory before the festival is nearly 600000 tons higher than that in previous years. It is expected that the inventory pressure of glass enterprises will be greater after the festival. In addition, housing sales were relatively weak in January, and the real estate market did not improve significantly. Therefore, in the case of high production and high inventory, once the demand is less than expected, the price still faces callback pressure.
