Key news tracking this week
On February 18, 12 departments including the national development and Reform Commission issued several policies on promoting the steady growth of industrial economy, involving 18 policies such as tax policy, financial credit, ensuring supply and price stability, investment and investment, land and energy use and environmental fees. The policy mentioned that we should further consolidate the growth momentum of the industrial economy, pay close attention to pre adjustment, fine adjustment and cross cycle adjustment, and ensure that the industrial economy operates within a reasonable range throughout the year. Among them, the policy proposes to accelerate the construction of major new infrastructure projects, guide telecom operators to accelerate the progress of 5g construction, support industrial enterprises to accelerate digital transformation and upgrading, and promote the digital transformation of manufacturing industry.
Price tracking comments on key products this week
WTI oil prices fell 1.4% this week to US $91.76/barrel.
Key injection sub industries: caustic soda / light soda ash / silicone / pure MDI / ethylene PVC / solid methionine / viscose staple fiber / liquid methionine / heavy soda ash / TDI rose by 13.6% / 7.1% / 3.2% / 2.2% / 2.1% / 2.0% / 1.9% / 1.4% / 1.3% / 0.5% month on month; VA / urea / polymerized MDI / rubber / DMF / ethylene glycol / acetic acid decreased by 10.4% / 3.9% / 3.5% / 2.9% / 1.8% / 1.1% / 1.1% month on month respectively; The price of Spandex / VE / titanium dioxide / viscose filament / calcium carbide PVC remains unchanged. The top five sub industries of this week’s growth: butadiene (Southeast Asia CFR) (+ 16.3%), ethylene oxide ( Sinopec Shanghai Petrochemical Company Limited(600688) ) (+ 13.9%), industrial lithium carbonate (+ 13.9%), caustic soda (32% ion-exchange membrane) (Jiangsu Liwen) (+ 13.6%), battery grade lithium carbonate (+ 12.8%).
Caustic soda: in Shandong, East China, central China, Henan, southwest and South China this week, due to the maintenance of some manufacturers, good signing of export orders in Jiangsu and dissatisfaction with the load of upstream alkali plants, the supply of liquid alkali in the yard is tight and the price is increased; The load of the upstream alkali plants in Hebei Province basically returned to normal this week, the supply of liquid alkali increased, and the market showed a downward trend.
Soda ash: the market price of soda ash in China continued to rise this week. Some enterprises stopped for maintenance, and the market supply decreased; In addition, soda ash manufacturers have sufficient orders and large quantities to be sent. Some soda ash enterprises maintain the trend of controlling or temporarily not receiving orders. Multiple favorable factors support the continuous rise of transaction prices of new orders in the soda ash market.
Market performance of chemical sector this week
The basic chemical sector rose 4.12% over last week, and the Shanghai and Shenzhen 300 index rose 1.08% over last week. The basic chemical sector outperformed the market by 3.04 percentage points, ranking fourth in all sectors. According to Shen Wan’s classification, the major weekly increases in the basic chemical sub industry include: phosphate fertilizer (+ 15.29%), pesticide (+ 9.73%), potassium fertilizer (+ 9.24%), phosphorus chemical industry and phosphate (+ 9.05%), and daily chemical products (+ 6.33%).
Key sub industry views
(1) many factors affect the 22-year boom of the sub industry. The overall profitability of the pesticide industry is expected to improve in the 22-year period when the cultivated land area is expected to increase, grain prices remain at a high level, China’s supply is orderly and prices rise in the fourth quarter. It is recommended that Jiangsu Yangnong Chemical Co.Ltd(600486) , Shandong Weifang Rainbow Chemical Co.Ltd(301035) , Anhui Guangxin Agrochemical Co.Ltd(603599) , Limin Group Co.Ltd(002734) ; The prosperity of the tire industry has bottomed out, and the new energy field has brought development opportunities. It is suggested to pay attention to Sailun Group Co.Ltd(601058) , Qingdao Sentury Tire Co.Ltd(002984) . The boom of viscose industry is expected to reverse, and Tangshan Sanyou Chemical Industries Co.Ltd(600409) is recommended. (2) The demand economy is relatively weak, and the fields of semiconductor materials, military materials and other new materials are independent and controllable in the medium and long term; Focus on the chemical synthesis platform company Valiant Co.Ltd(002643) and China’s private gas leading enterprise Suzhou Jinhong Gas Co.Ltd(688106) . (3) The downstream demand is stable, and great attention is paid to the subdivided fields such as photovoltaic, wind power, new energy and sugar substitutes; Focus on recommending Shenzhen Capchem Technology.Ltd(300037) as the leader of new energy functional materials and Anhui Jinhe Industrial Co.Ltd(002597) as the leader of global sweeteners. (4) The vertical and horizontal expansion of the leading enterprises has highlighted the advantages of integration, and the profit center is expected to rise; Key recommendations are Wanhua Chemical Group Co.Ltd(600309) , Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) , Zhejiang Nhu Company Ltd(002001) .
Risk warning: risk of large fluctuation of crude oil price; Covid-19 epidemic leads to less demand than expected risk; Safety and environmental protection risks
