This week’s Chemical Market Overview
The market stabilized after a sharp decline this week, in which the Shenwan chemical index fell 4.29% and lost 0.07% to the Shanghai and Shenzhen 300 index. In terms of subject matter, the subject matter of covid-19 industrial chain has a strong performance, with damaged cost rise + large increase in the early stage, and the subject matter is under pressure. We think it can be analyzed from the three dimensions of market concern point, key indicator tracking and layout time point. At present, the market is mainly worried about stagflation + geopolitical diffusion, and there are still great uncertainties in the above two points, such as how to interpret the situation in Russia and Ukraine and how to interpret inflation. Therefore, the current market is still in a state of chaos and bad, There is the possibility of pressure; In terms of key tracking indicators, we believe that there are three main points: the first is the progress of the Russian Ukrainian incident, the second is the trend of commodity prices, and the third is the change of geopolitics. These three indicators need to be further tracked, which may also be one of the reasons for the current market biased game; In terms of layout time point, we have observed that many high-quality targets have experienced a sharp correction recently. The market is concerned about when they can be laid out, especially when they can really see the bottom. We think it is difficult to judge the real bottom of the target at present, but we can judge the current cost performance and odds of the target in combination with the central valuation and bottom valuation. If the valuation is gradually close to the historical bottom valuation, Then the gradual layout can be considered.
Portfolio recommendation
\u3000\u3 Jointo Energy Investment Co.Ltd.Hebei(000600) 426 Ningxia Baofeng Energy Group Co.Ltd(600989) Jiangsu Flag Chemical Industry Co.Ltd(300575)
Major events of this week
Russia decided to stop fertilizer exports. On March 10 local time, the Russian Ministry of industry said that the country decided to temporarily stop the export of chemical fertilizer. Russia is an important fertilizer producer and exporter in the world. Its output of ammonia, potassium fertilizer, phosphorus fertilizer and urea accounts for 23%, 18%, 15% and 14% respectively. It is the world’s largest exporter of nitrogen fertilizer, the second largest exporter of potassium fertilizer and the fourth largest exporter of phosphorus fertilizer. Since Belarus was sanctioned last year, the international potash supply has been in a tight state. If the fertilizer export policy is stopped this time, the potash supply is expected to be further tight.
Huntsman imposes a gas surcharge on MDI prices in Europe / Middle East / Africa / India. Affected by the fluctuation of European natural gas prices and record highs, huntsman was forced to impose a natural gas surcharge of 300 euros per ton on MDI, polyether, additives and catalyst products sold in Europe, Africa, the Middle East and India. This surcharge will take effect on orders in March, and the price fluctuation of natural gas needs to be evaluated for orders in April.
Risk tips
The epidemic affects demand outside China, crude oil prices fluctuate violently, and changes in international policies affect industrial layout.
