The prices of many products fell. On the other hand, the attention of semiconductors and new energy materials continues to increase.
Industry trends:
Among the 101 chemical varieties tracked this week, the prices of 18 varieties rose, 53 varieties fell and 30 varieties remained stable. The top five varieties were yellow phosphorus, dichloromethane, WTI crude oil, urea and nitric acid; The top five varieties of decline were trichloroethylene, PVA, metal silicon, NYMEX natural gas and R134a.
WTI crude oil closed at USD 71.96/barrel this week, with a weekly increase of 8.60%; Brent crude oil closed at US $75.27/barrel, up 7.71% for the week. Affected by the easing of concerns about Omicron virus and the deadlock in the negotiation of Iran’s nuclear agreement, crude oil prices continued to rise this week. EIA data released this week showed that U.S. crude oil inventories fell 241000 barrels, less than expected. In the future, it still takes a certain period of time for Iranian crude oil to enter the international market. Before that, the supply side of the crude oil market is still good. It is expected that the international crude oil price will fluctuate and consolidate next week.
The price of yellow phosphorus continued to rise this week. According to the data of Baichuan Yingfu, the price of yellow phosphorus in Sichuan closed at 40000 yuan / ton, up 11.11% from the closing of last week. In terms of supply, the output of yellow phosphorus this week (12.04-12.10) was 14514 tons, with a week-on-week increase of 9.01%; The supply increment mainly comes from the resumption of production or load increase of individual manufacturers in Maitreya and Luliang areas of Yunnan Province; As of December 9, the operating rates of the three provinces were 57.74%, 32.17% and 65.79% respectively. From the demand side, the downstream demand for glyphosate, thermal phosphoric acid and phosphorus trichloride is good, and the order inquiry is positive. In terms of raw materials, the price of phosphate rock remains high; As of December 9, the average market price of phosphorus ore is 645 yuan / ton. It is expected that the price of phosphorus ore will continue to rise in the later stage, and the price of yellow phosphorus may return to the upward track due to downstream demand, cost side support and electricity price reform in Yunnan and Sichuan.
Refrigerant prices continued to fall this week. As of December 10, according to Baichuan Yingfu data, the average market prices of R134a and R22 were 29000 yuan / ton and 17500 yuan / ton respectively, down 13.43% and 7.90% respectively compared with the closing of last week. Among them, R134a has decreased by 42.00% compared with the high point of 50000 yuan / ton on October 28. In terms of demand, since R125, R134a and other refrigerants are listed in the list of controlled ozone depleting substances for import and export in China, the import and export license management system will be implemented for the substances listed in the list from November 1, 2021, and the export is blocked; In addition, due to the continuation of the global automobile “chip shortage”, the automobile production continues to decline, or the demand for R134a and other refrigerants decreases. On the supply side, near the end of the year, manufacturers’ willingness to arrange inventory increases; In addition, as the new quota will be released, the overall supply is relatively loose. Raw material end: trichloroethylene, the main raw material of R134a, fell sharply. As of December 10, the average market price of trichloroethylene was 8457 yuan / ton, down 40.39% from the closing of last week, and about 63.23% from 23000 yuan / ton on November 17. It is expected that the price of all refrigerant products will continue to decline in the short term due to the decline of raw material end.
Investment suggestions:
This month’s view:
Cyclical industries: the price fluctuation of subdivided products increased: as of November 26, the price of only 19% of the tracked products increased month on month; 76% of the product prices fell month on month, with a decline of more than 20% accounting for 19%; Another 5% of the product prices were flat. As of November 26, due to the sharp decline in crude oil prices on that day, WTI prices fell 19.3% month on month, Brent crude oil prices fell 15.9% month on month, and WTI fell below $70 / barrel. Compared with the same period in 2020, the price of about 84% of chemical products increased year-on-year; Compared with the beginning of 2021, the price of chemical products also increased by 91%. Industry data: the PPI index of the chemical industry in October was 119.8, up 3.3% month on month (MOM) from September. Since November, with the relaxation of the policy of limiting production and power and the decline of energy prices, the construction of chemicals has gradually resumed, and the price has decreased significantly month on month. Long term optimistic about the development of leading companies in the context of carbon neutrality.
Growth companies: benefiting from the rapid development of downstream new energy vehicles, photovoltaic and other industries, Upstream material (such as EVA / DMC / NMP / PVDF / metal silicon, etc.) the supply is also tight, and the boom duration is expected to be long. On the other hand, China’s semiconductor material industry is in a period of rapid development. First, localization may be greatly improved in the last two years; second, in some products, the supply is in short supply this year, or some products have risen due to the influence of raw materials Price; Considering the low performance base before, some semiconductor material companies maintained a high growth rate in the third quarter.
Investment suggestions: looking forward to December, the chemical industry is facing certain adjustment pressure due to the impact of the epidemic and the sharp correction of oil prices. Pay attention to the valuation of private refining, industry leaders and other related chemical enterprises return to a low level again. On the other hand, the attention of sub industries such as semiconductors and new energy materials continues to increase. In the medium and long term, as the profitability continues to exceed expectations, high-quality chemical assets are expected to usher in value revaluation. Recommended stocks: Wanhua Chemical Group Co.Ltd(600309) , Jiangsu Eastern Shenghong Co.Ltd(000301) , Rongsheng Petro Chemical Co.Ltd(002493) , Zhejiang Nhu Company Ltd(002001) , Zhejiang Huangma Technology Co.Ltd(603181) , Jiangsu Yoke Technology Co.Ltd(002409) , Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) , Lianhe Chemical Technology Co.Ltd(002250) , Tongkun Group Co.Ltd(601233) , Crystal Clear Electronic Material Co.Ltd(300655) , Valiant Co.Ltd(002643) , etc., pay attention to Shandong Sinocera Functional Material Co.Ltd(300285) , Hoshine Silicon Industry Co.Ltd(603260) , Hubei Xingfa Chemicals Group Co.Ltd(600141) , etc.
December gold shares: Crystal Clear Electronic Material Co.Ltd(300655)
Risk statement
1) Changes in geopolitical factors lead to sharp fluctuations in oil prices; 2) The global epidemic situation has changed.
