Core view
1. In the second half of 2021, Belarus potash was jointly sanctioned by Europe and the United States, and the U.S. Department of Finance issued Belarus general license No. 4. The sanctions are mainly against belaruskalioao, the largest potash enterprise in Belarus, and are scheduled to be implemented on April 1, 2022. On the day of the implementation of the sanctions, the international price of potash fertilizer rose rapidly again. As of April 1, 2022, the FOB prices of potassium chloride in Vancouver and northwest Europe were US $852 and US $901.5/t respectively, up US $103.5 and US $87.5/t respectively compared with March 31, up 13.83% and 10.75% respectively compared with the previous week, and up 36.0% and 45.5% respectively compared with the beginning of the year. Washington asked the customers of Belarus potash to end business with the company before April 1. Since Belarus was sanctioned, the global potash supply gap has been increasing. According to NRCan data, the export of potash fertilizer from Belarus accounted for 21% of the global total in 2020. After Belarus was sanctioned, the Lithuanian state-owned railway suspended its cooperation with Belarus, which blocked the export and transportation of potassium fertilizer from Belarus, and so far no reliable solution has been found. In March 2022, under the conflict between Russia and Ukraine, Russia announced the suspension of fertilizer export. Russia's potash fertilizer exports account for 19% of the global total. Superimposed on the Belarus potash fertilizer export sanctions, about 40% of the global potash fertilizer supply will be affected, and the supply gap will continue to increase. At present, China is in the spring farming period, with strong demand in the downstream of potassium fertilizer and low inventory. As of April 1, 2022, the inventory of potassium chloride plants in China was 284000 tons, a low level in recent three years, a decrease of 77.4% compared with 1255000 tons in the same period in 2020. The low-level operation of inventory reflects the situation of strong downstream demand and short supply. At present, once the US sanctions against Belarus are implemented, the resulting supply gap may be difficult to make up in a short time. Under the situation of short supply, the global price of potash fertilizer is expected to continue to rise in 2022.
2. As of April 1, 2022, the price index of China's chemical products reported 5789 points, down 1.5% on a weekly basis. Chemical products were mixed, with natural rubber spot up 3.1% and acrylic acid down 6.1%. In terms of natural rubber, the price rise is mainly due to the low production of natural rubber in the world and the seasonal low output of raw materials in Thailand. In terms of acrylic acid, the price decline is mainly affected by the demand side. The downstream acrylate has entered the off-season, with poor rigid demand. In addition, due to limited transportation, the actual transaction is relatively cold, and the low price of the market continues to refresh.
3. Coking coal prices have risen significantly in the past week. As of April 1, 2022, the settlement price of the main continuous futures of coking coal was reported at 3741 yuan / ton, up 15.3% on a weekly basis. The sharp rise in coking coal prices is mainly due to the impact of supply and demand: in terms of supply, some open-pit coal mines in Inner Mongolia are subject to environmental protection inspection, some local mines in Guizhou are subject to safety inspection, the production is less than expected, and there is a shortage of coking coal supply in the region; In terms of demand, with the gradual unsealing of Hebei, the willingness of coke enterprises and traders to purchase has increased, and there is a strong expectation of replenishment of coking coal.
4. Market review. Last week, among the 33 tertiary sub industries of CITIC chemical, 18 sectors rose or remained flat and 15 sectors fell. Among them, polyurethane sector increased the most, with an increase of 8.6%; Membrane materials sector fell the most, down 5.6%. In terms of individual stocks, the top three weekly gains were Gpro Titanium Industry Co.Ltd(000545) , Jiangsu Flag Chemical Industry Co.Ltd(300575) , Kunming Chuan Jin Nuo Chemical Co.Ltd(300505) , with weekly gains of 36.9%, 28.3% and 23.6% respectively; The top three weekly declines were Zhejiang Zhongxin Fluoride Materials Co.Ltd(002915) , Sichuan Jinlu Group Co.Ltd(000510) , Zhejiang Benli Technology Co.Ltd(301065) , with weekly declines of 18.2%, 15.8% and 15% respectively.
Investment advice
Under the global shortage of potash fertilizer supply, relevant production enterprises may benefit, such as Asia-Potash International Investment (Guangzhou) Co.Ltd(000893) , Zangger mining, Qinghai Salt Lake Industry Co.Ltd(000792) , Qingdao East Steel Tower Stock Co.Ltd(002545) , etc.
Risk tips
International geopolitical changes, upgrading of safety and environmental protection policies, abnormal exchange rate fluctuations, etc.
