Benefiting from the continuous and sharp rise of glyphosate price in 2021, the annual report performance of major relevant enterprises in China is collectively expected. Among the glyphosate companies that have published the annual report forecast, the performance has at least doubled, and the largest Sichuan Hebang Biotechnology Co.Ltd(603077) (603077. SH) is expected to increase the net profit by at least 72 times.
The price boom of glyphosate is expected to continue. Li Jinmei, an analyst of Longzhong information industry, told the financial associated press that the price of glyphosate has remained at 78000 yuan / ton since January, and this price is expected to continue until April this year. However, for the downstream market, spring ploughing and preparation are imminent, and the high price of glyphosate still inhibits the demand of some downstream preparation enterprises. There is a price game between the upstream and downstream.
continue to maintain high prices
Among the glyphosate enterprises that have released the annual report forecast, Sichuan Hebang Biotechnology Co.Ltd(603077) has the largest performance increase. It is expected that the net profit will increase by 2.96 billion yuan - 3.26 billion yuan in 2021, with a year-on-year increase of 7227.36% - 7960.09%. Hubei Xingfa Chemicals Group Co.Ltd(600141) (600141. SH) it is estimated that the profit in 2021 will be 4.2-4.4 billion yuan, with a year-on-year increase of 573.14% - 605.19%. Zhejiang Xinan Chemical Indusyrial Group Co.Ltd(600596) (600596. SH) it is estimated that the net profit in 2021 will be 2.6-2.7 billion yuan, with a year-on-year increase of 344% - 362%; Nantong Jiangshan Agrochemical & Chemicals Co.Ltd(600389) (600389. SH) it is estimated that the net profit of the company in 2021 will be 780 million yuan to 865 million yuan, with a year-on-year increase of 132.88% to 158.26%.
Based on the analysis of the reasons for performance growth, enterprises all said that during the reporting period of 2021, the chemical and pesticide industries ushered in a business cycle, the sales price of glyphosate increased significantly year-on-year, and the profitability was significantly enhanced.
The business cycle of glyphosate is expected to continue in 2022. East Asia Qianhai Industry Research Report shows that at the end of December 2021, the central rural work conference stressed that agriculture is a fundamental issue related to national livelihood. According to the data of the Ministry of agriculture, the sown area of grain in China was 1.764 billion mu in 2021, an increase of 12.95 million mu over the previous year, an increase of 0.7% for two consecutive years. The development potential of chemical fertilizers and pesticides closely related to agriculture is huge. The glyphosate market is expected to continue to improve in 2022. On the one hand, the new capacity of glyphosate is limited, and the supply and demand maintain a tight balance; On the other hand, the high price of raw materials in the upstream supports the continuous upward price of glyphosate.
According to the price data of Longzhong information, as of January 13, the average sales price of glyphosate in China was 78000 yuan / ton, which continued to maintain a high price. Li Jinmei told the financial associated press that the current glyphosate price has fallen slightly compared with that in December last year, but it is still nearly four times higher than the average price of 20000 yuan / ton in the past. Affected by this, the downstream preparation enterprises have greatly reduced the demand for raw material preparation before the Spring Festival, and the upstream and downstream have formed a price game. Sales must be restrained.
However, enterprises are optimistic about the form of sales and price. The relevant person in charge of Hubei Xingfa Chemicals Group Co.Ltd(600141) said that at present, the company's Glyphosate order has been scheduled to April 2022. In this regard, some business people told the financial associated press that Hubei Xingfa Chemicals Group Co.Ltd(600141) as an industry leader, the orders are scheduled to April, which means that this year's spring farming sales have been covered, so there is no room for glyphosate prices to fall before April.
increased industry influence
While maintaining high prices, the profitability of glyphosate products is also increasing. According to relevant industry data, as of January 13, the high level of glyphosate raw material glycine was loose, yellow phosphorus decreased widely, methanol went up, paraformaldehyde, liquid chlorine and triethylamine fluctuated at the medium and low levels, and the cost went down. Affected by this, according to the estimation of Longzhong information, the profit of glyphosate at the price of 78000 yuan / ton is about 38300 yuan / ton, which is at the highest point in history.
Guosen Securities Co.Ltd(002736) the chemical analyst team said that they are optimistic about the continued high outlook of glyphosate industry in the future. At present, the global glyphosate production capacity is about 1.1 million tons. In addition to Bayer's 380000 tons of overseas production capacity, the remaining 700000 tons of production capacity are all concentrated in China. In 2022, except for the 50000 tons of glyphosate capacity reconstructed and expanded by Xingfa in Inner Mongolia, there is no new capacity, but the demand for glyphosate continues to grow steadily. In particular, the demand for glyphosate in China in overseas markets may further increase in 2022.
The influence of glyphosate is also increasing in the A-share market. The glyphosate sector rose twice this week. On January 10, the glyphosate sector rose by 2.63% and 1.11% on January 12. Statistics show that in the past 30 days, a total of 6 glyphosate concept stocks have received favorable ratings such as "buy" or "overweight" from institutions. Among them, Hubei Xingfa Chemicals Group Co.Ltd(600141) has been recommended by institutions recently, and 5 concept stocks such as Shandong Weifang Rainbow Chemical Co.Ltd(301035) , Zhejiang Xinan Chemical Indusyrial Group Co.Ltd(600596) , Nantong Jiangshan Agrochemical & Chemicals Co.Ltd(600389) , Shenzhen Noposion Agrochemicals Co.Ltd(002215) , Sichuan Hebang Biotechnology Co.Ltd(603077) have been recommended by institutions twice or more.
It is also worth mentioning that the latest dynamic P / E ratio of glyphosate plate is 22.13 times, and the valuation of the plate is at the bottom of history. Among them, the latest valuations of Zhejiang Xinan Chemical Indusyrial Group Co.Ltd(600596) , Sichuan Hebang Biotechnology Co.Ltd(603077) , Hubei Xingfa Chemicals Group Co.Ltd(600141) and other three concept stocks are less than 20 times. Under the background of continuous high profits of glyphosate, the overall prospect of the sector is promising.
