Event:
In December, the PPI of industrial producers in China increased by 10.3% year-on-year and decreased by 1.2% month on month. comment:
1. The year-on-year growth rate of PPI accelerated and fell in December
In terms of means of production, PPI increased by 13.4% year-on-year, 3.6 percentage points lower than that of last month; In terms of means of living, PPI increased by 1.0% year-on-year, flat compared with the previous month.
By industry, among the 30 major industries, PPI increased year-on-year in 8, flat in 1 and declining in 21; Compared with the previous month, the month on month increase of PPI was expanded in 7, flat in 0 and declining in 23.
Overall, with the gradual repair of industrial capacity utilization and further decline of economic demand, the price of industrial products began to decline rapidly in December.
2. The order of PPI strength of commodity related industries in December is: Black > colored > energy > Shenzhen Agricultural Products Group Co.Ltd(000061)
From the perspective of black commodity related industries, the coal mining and washing industry performed strongly, with PPI increasing by 66.8% year-on-year, down 22.0 percentage points from the previous month; The ferrous metal smelting and calendering processing industry and ferrous metal mining and beneficiation industry fluctuated at a high level, and the PPI was 21.4% and – 2.6% respectively year-on-year, both of which fell significantly.
From the perspective of non-ferrous commodity related industries, the non-ferrous metal smelting and rolling processing industry performed strongly, with PPI increasing by 20.0% year-on-year; PPI of nonferrous metal mining and dressing industry increased by 12.3% year-on-year, and the increase was significantly lower than that of last month.
From the perspective of Shenzhen Agricultural Products Group Co.Ltd(000061) related industries, the agricultural and sideline food processing industry continued to recover, with PPI increasing by 2.4% year-on-year, down from the previous month.
In terms of energy and chemical products related industries, the oil and natural gas exploitation industry, oil & coal and other fuel processing industry, chemical raw materials and chemical products manufacturing industry and chemical fiber manufacturing industry increased by 45.6%, 36.4%, 23.8% and 18.4% respectively year-on-year, and the prosperity decreased significantly; The prosperity of textile industry, rubber and plastic products industry, textile and clothing industry and clothing industry decreased slightly.
3. Affected by the increased supply of industrial products and sluggish demand, PPI may continue to fall in January. At present, Europe and the United States are still in the macro situation of stagflation, while China’s economy remains low. Considering that the Federal Reserve may speed up in late January
As for the rate of interest rate increase, the U.S. government has suppressed the energy inflation policy, the o variant virus is still spreading at a high speed, and the supply and demand fundamentals of crude oil and non-ferrous metals are still tight. We believe that foreign demand commodities such as crude oil related commodity chain and new energy non-ferrous metals may show a high and wide shock pattern in January.
In terms of China’s upstream supply, power coal supply is still in force, and policy control and high inventory still suppress the momentum of substantial price rise; In addition, the double control policy was corrected and the power supply returned to normal. The high-level set the tone. It is not appropriate to introduce tightening policies in the near future. The industrial production of upstream and midstream enterprises further recovered, which alleviated the risk of continued upward inflation of domestic demand commodities to a certain extent.
In terms of downstream construction activities in China, the sales volume of excavators in China decreased by 43.5% year-on-year in December, which was somewhat less than that of the previous month. It is expected that the year-on-year decline in January will be further reduced; We expect that the relevant indicators of real estate will continue to stabilize gradually in the first quarter, and the infrastructure will have a high probability of pre force.
At the policy level, the central economic work conference set the tone of “taking the lead in stability and seeking progress in stability”, and real estate implemented the “housing policy” by means of simultaneous rent and purchase, affordable housing construction, supporting the commercial housing market to better meet the reasonable housing needs of buyers, and urban policies
Not fried “; The NPC also called for accelerating investment in infrastructure projects. We believe that the end of the policy since November has been confirmed, and the dawn of the end of demand in the first quarter is beginning to appear, which will be continuously confirmed by meso and micro high-frequency data. We expect that domestic demand commodities as a whole will gradually stabilize in the first quarter and rebound further in the second quarter; In the first half of the year, it may gradually enter a new cycle of moderately small leverage, wide currency, wide credit and wide finance, which will strongly support the further shock and strength of commodity indexes from the second quarter to the second half of the year. In the short term, PPI may continue to fall in January.
