Core view
Establish a national unified power market to promote the rapid development of green power. Recently, the meeting of the central Deep Reform Commission proposed to build a national unified power market system, promote the construction of power market mechanism to adapt to the transformation of energy structure, and orderly promote the participation of new energy in market transactions. In addition, the State Grid has also issued the inter provincial power spot trading rules, which proposes that all power generation types and enterprises can participate in inter provincial power spot trading and encourage inter provincial green power trading. The construction of a national unified power market system can not only increase the green power premium, but also increase the green power consumption proportion, which is conducive to ensuring the profitability of new energy power generation enterprises and accelerating the clean and low-carbon transformation of the power system.
Cement and glass prices continued to decline. With the cold weather, the northern region began to implement the staggered peak kiln shutdown plan in the heating season. At the same time, there was a rush demand in some southern regions, but the demand was lower than that in the same period of previous years, and the downward demand led to the decline of cement price. With the decline of coal price, the cement coal price difference fell month on month and increased year-on-year, and the profitability of the industry decreased slightly month on month and narrowed year-on-year. The spot price of float glass continued to decline this week. Due to the rush demand, the inventory of float glass enterprises in some areas decreased, but the overall inventory is still on the high side. In terms of cost, the price of soda ash has declined to a certain extent, but the price of fuel has increased.
Demand picked up, steel prices rebounded, and steel mill profits improved. This week, steel prices rebounded in a narrow range, and the gross profit per ton of steel and the profitability of steel mills improved significantly. In terms of supply, under the production restriction policy and floating loss, the enterprise's production enthusiasm is not high, resulting in the continuous decline of supply. It is expected that the supply side will still operate at a low level by the end of the year. In terms of demand, it is in line with our previous expectations. Affected by the land rush period, the relaxation of production margin and capital mitigation, the short-term demand is slightly released, resulting in the recovery of consumption. On the raw material side, the trend of internal and external ore of iron ore is differentiated, coke continues to fall, and scrap steel is stronger. Due to the remarkable effect of limiting production in the first ten months, the subsequent factors affecting the supply side will be transferred to the floating loss of the steel plant; This round of demand recovery is expected to continue for a short time. In the long run, the steel market will continue the pattern of double weakness of supply and demand.
The coal market has warmed up, and the spot price of thermal coal is now showing signs of stopping falling. In the past two weeks, the demand for replenishment has gradually increased, and the futures market price has rebounded slightly. In the capital market, since November 16, the coal index has rebounded by 5%, and the market sentiment has improved compared with before. With the gradual implementation of the measures to increase production and ensure supply and the price limit policy, the supply at the origin end is continuously released, and the inventory at all links is gradually increased to a reasonable range. It is expected that in the later period into December, the demand for coal in winter will become more and more vigorous, the coal price may become stable after a sharp reduction in the short term, and the supply and demand of the coal market will gradually develop from tight to basically balanced.
Investment suggestion: environmental protection and public use: it is recommended to pay attention to China Power (2380. HK), Huaneng Power International Inc(600011) (600011. SH), China Resources Power (0836. HK), Longyuan Power (0916. HK), China Three Gorges Renewables (Group) Co.Ltd(600905) (600905. SH), Henan Bccy Environmental Energy Co.Ltd(300614) (300614. SZ). Building materials: recommended China Jushi Co.Ltd(600176) (600176. SH), Beijing New Building Materials Public Limited Company(000786) (000786. SZ), Beijing Oriental Yuhong Waterproof Technology Co.Ltd(002271) (002271. SZ), Keshun Waterproof Technologies Co.Ltd(300737) (300737. SZ), Zhejiang Weixing New Building Materials Co.Ltd(002372) (002372. SZ), Guangdong Kinlong Hardware Products Co.Ltd(002791) (002791. SZ), Zhuzhou Kibing Group Co.Ltd(601636) (601636. SH). Steel: recommended Baoshan Iron & Steel Co.Ltd(600019) (600019. SH), Hunan Valin Steel Co.Ltd(000932) (000932. SZ), Yongxing Special Materials Technology Co.Ltd(002756) (002756. SZ), Fushun Special Steel Co.Ltd(600399) (600399. SH), Citic Pacific Special Steel Group Co.Ltd(000708) (000708. SZ). Coal: recommended China Shenhua Energy Company Limited(601088) (601088. SH), Shaanxi Coal Industry Company Limited(601225) (601225. SH), Shanxi Coking Coal Energy Group Co.Ltd(000983) (000983. SZ).
Risk warning: the risk of sharp fluctuations in raw material prices; The risk that the downstream demand is less than expected, and the landing effect of production restriction is less than expected; The risk that the policy strength is less than expected; The risk that the new capacity of the industry exceeds the expectation; The risk of sharp decline in coal prices under the pressure of policy regulation.
