We believe that the investment strategy of the chemical industry is to invest in systematic innovation and low-cost expansion. The next industrial pattern of chemical industry depends on talent competition. The chemical industry has changed from a simple capital intensive industry to a talent and capital intensive industry. The latecomers can't surpass the capital and can only stare at the latecomers. Therefore, the periodicity of the chemical industry becomes weaker. With effective incentives, excellent management and continuous innovation, excellent companies have created unshakable advantages in technology iteration, low cost and efficient service, and have conquered cities and occupied land in the global market.
This week, the overall performance of Shenwan chemical sector ranked sixth, up 4.27%, stronger than the overall trend of the market. Shanghai Composite Index and gem index were + 2.02% and + 2.51% respectively. Shenwan chemical sector outperformed Shanghai Composite Index by 2.25 percentage points and gem index by 1.76 percentage points.
Weekly tracking of chemical price
The top weekly increases in chemical prices this week were polyester filament (+ 7.41%), phosphate rock (+ 6.94%) and sulfur (+ 6.48%). ① Polyester filament: the average polymerization cost of polyester filament this week increased by 271.43 yuan / ton compared with the average cost of last week, the average operating rate of enterprises decreased by 0.11%, and the price rose due to the combination of supply decline and cost rise; ② Phosphate rock: mainstream enterprises in Guizhou kaiphosphorus group, Yunnan Yunnan Yuntianhua Co.Ltd(600096) and other main production areas mainly use phosphate rock for their own use, reducing the supply of goods in the market, resulting in rising prices; ③ Sulfur: this week, some manufacturers reduced their production through maintenance, and the resource supply was tight, resulting in the continuous rise of prices.
This week, the prices of chemical products fell by the top in terms of methyl ethyl ketone (- 11.11%), dichloromethane (- 7.22%) and soft foam polyether (- 4.70%). ① Methyl ethyl ketone: the average operating rate of butanone unit this week increased compared with last week, and the market demand of downstream coatings, adhesives and other industries is weak. The superposition of supply and demand results in a sharp decline in prices; ② Dichloromethane: the market price of methanol this week was affected by the futures price of crude oil and thermal coal. The futures market price fell and the cost fell, resulting in a decline in the price. ③ Soft foam polyether: this week, the market price of propylene oxide was obviously affected by the fluctuation of raw material price, with a slight decline. The cost of soft foam polyether decreased, resulting in a decline in price.
The weekly increase of chemical price difference this week was PTA (+ 41.06%), spandex (+ 11.50%), yellow phosphorus (+ 9.42%). ① PTA price difference: there is no obvious change in PTA market supply this week, and the downstream demand is stable. However, due to the obvious increase in the cost side, the price rises and the price difference expands; ② Price difference of spandex: this week, the price of PTMEG, the main raw material of spandex, increased and fell due to demand. Although the price of spandex decreased slightly, the price difference still expanded. ③ Yellow phosphorus price difference: this week, there was strong demand in the downstream thermal phosphoric acid, phosphorus containing pesticides and phosphorus trichloride industries of yellow phosphorus, and the price of yellow phosphorus continued to rise, resulting in the expansion of the price difference.
The weekly decline in the price difference of chemical products this week was polyester staple fiber (- 116.32%), thermal phosphoric acid (- 42.13%) and polyester industrial yarn (- 18.96%). ① Price difference of polyester staple fiber: the price of polyester staple fiber raw materials rose with the trend of crude oil this week, while the price of polyester staple fiber fell slightly due to sluggish demand and increased supply, which led to the narrowing of the price difference; ② Price difference of hot process phosphoric acid: the price of yellow phosphorus at the raw material end continued to rise, driving the price of phosphoric acid to rise slightly, but it could not offset the increase at the cost end, resulting in the narrowing of the price difference. ③ Polyester industrial yarn price difference: this week, the price of polyester industrial yarn raw materials increased with the oil price, resulting in the narrowing of the price difference.
Weekly tracking of key industries
Synthetic biology: the national development and Reform Commission printed and issued the "14th five year plan" for bioeconomy development. A trillion track is about to emerge. It is suggested to pay attention to Cathay Biotech Inc(688065) , Anhui Huaheng Biotechnology Co.Ltd(688639)
Industry trends: the national development and Reform Commission issued the "14th five year plan" for the development of bioeconomy, which defines four key development areas of bioeconomy. First, comply with the new trend of "disease treatment as the center" to "health as the center", and develop biomedicine for people's life and health. Second, comply with the new trend of "solving food and clothing" to "diversified nutrition", and develop biological agriculture oriented to agricultural modernization. Third, comply with the new trend of "pursuing production capacity and efficiency" to "adhering to ecological priority", and develop green and low-carbon biomass alternative applications. Fourth, comply with the new trend of "passive defense" to "active support", and strengthen the construction of national biosafety risk prevention, control and governance system.
Financing situation: the financing of synthetic biology company has accelerated, and Zeno technology, enzyme race biology and micro structure factory have successively completed multiple rounds of financing. Since 2022, a total of 14 enterprises in China have completed new financing. In May, Baiyin biology, an innovative biomaterial R & D and application enterprise, announced the completion of an angel + round of financing of tens of millions of yuan. This round of financing is led by Tiantu investment and followed by cornerstone capital. This round of financing is mainly used for the expansion of R & D center and the construction of pilot test platform. Ketaiya Biotechnology Co., Ltd. announced the completion of a round of financing of more than 100 million yuan, led by source capital, followed by food core capital and Sherpa investment, and Yuanqi capital acted as the exclusive financial adviser. The proceeds from this round of financing will be mainly used to expand the team, build a technical platform and promote product pipelines of cotaia biology.
Phosphate fertilizer and phosphate chemical industry: the supply of Monoammonium and ferric phosphate is tight and the price rises. It is suggested to pay attention to Yunnan Yuntianhua Co.Ltd(600096) , Sichuan Development Lomon Co.Ltd(002312) , Guizhou Chanhen Chemical Corporation(002895)
Monoammonium phosphate: the price rose sharply this week and the market supply was tight. At present, it is in the fertilizer season, and the downstream demand is increasing day by day. It is expected that the price of Monoammonium will remain high and upward under the favorable influence of cost and demand in the short term.
The price of phosphoric acid is at a high level and the supply of iron is in short supply this week. The price of raw material yellow phosphorus is at a high level, resulting in increased market pressure on upstream phosphoric acid and tight supply of iron phosphate. The actual demand of downstream is far greater than that of iron phosphate. It is expected that the supply of iron phosphate will continue to be tight in the short term.
Polyurethane: the prices of polymerized MDI, pure MDI and epoxy 8888 propane have fallen. It is recommended to pay attention to Wanhua Chemical Group Co.Ltd(600309)
Aggregated MDI: this week, the demand for aggregated MDI was limited and the price fell slightly. With the emergence of signs of unsealing in Shanghai, the commencement of local factories has increased, and the overall supply has increased this week. However, the overall demand of downstream enterprises is weak. Both supply and demand are weak, and prices are expected to continue to fall in the short term..
Pure MDI: the downstream demand of pure MDI was insufficient this week, and the price fell slightly. The downstream spandex industry started steadily, and the raw materials were purchased according to the contract quantity. The start of other downstream enterprises was not high, and the overall demand was released slowly. It is expected that the market is still in the downward stage.
Propylene oxide: the overall price of propylene oxide raw material end fell this week, and the market price fell significantly. The raw material propylene fell slightly due to the fluctuation of international crude oil price, while the price of liquid chlorine fell sharply, and the cost of propylene oxide decreased significantly. At the same time, there is insufficient demand in the terminal market, and the price is expected to maintain a downward trend in the short term
Pesticides: the prices of glyphosate and glufosinate are rising. It is suggested to pay attention to Jiangsu Yangnong Chemical Co.Ltd(600486) , Anhui Guangxin Agrochemical Co.Ltd(603599) , Lier Chemical Co.Ltd(002258)
Glyphosate: the market supply fell this week, and the price of glyphosate rose slightly. The overall supply of the market this week remains relatively stable compared with last week, and the market demand for glyphosate has no obvious fluctuation compared with last week. However, considering that glyphosate is about to enter the end of the traditional peak demand season, the price of glyphosate is expected to be reduced slightly next week.
Glufosinate: the market is in short supply this week, and the price focus of glufosinate has shifted upward. Guang'an production base, a mainstream enterprise in China, experienced a slight decline in market supply due to the static management of the epidemic on May 17. Overseas demand expanded, and the market was in short supply.
In the short term, the price of glyphosate is expected to continue to rise.
Coal chemical industry: the price of carbon black is stable and the price of coke is reduced. It is suggested to pay attention to Ningxia Baofeng Energy Group Co.Ltd(600989) , Jiangxi Black Cat Carbon Black Inc.Ltd(002068) , Shandong Hualu-Hengsheng Chemical Co.Ltd(600426)
Carbon black: this week, the carbon black market has great cost pressure and the price is stable. On the cost side, the price of coal tar fell slightly this week, and the price is still high. On the demand side, the downstream tire market has high inventory and weak demand. It is expected that the subsequent tire industry will reduce production and operation, and the carbon black price will gradually move closer to the medium and low level.
Coke: this week, the coke market price decreased and the downstream demand was stable. The overall coking industry started nearly 78.2%, there was no pressure on the coke inventory of coke enterprises, and the downstream coke demand was stable. It is estimated that after the three rounds of coke reduction, the short-term price will remain stable.
Chemical fiber: Spandex continues to decline and the price of viscose staple fiber rises. It is suggested to pay attention to Huafon Chemical Co.Ltd(002064) , Yantai Tayho Advanced Materials Co.Ltd(002254)
Spandex: the cost side support is weak this week, and the spandex market continues to decline. The market price of main raw materials has declined slightly, and the operating rate of the industry is 80% - 85%. The supply of spandex in the yard is stable, but the demand has not improved significantly. It is expected that the market price of spandex will maintain a downward trend next week.
Polyester: the cost pressure of polyester is high this week, and the market price rises slightly. Polyester market is in full supply this week. Affected by the rise of crude oil price, the PTA Market of main raw material rises slightly, but the downstream demand of slice Market and bottle slice Market is weak. It is expected that there will be a price without market in the short term.
Viscose staple fiber: the viscose staple fiber market is stable and positive this week, and the price continues to rise. During the week, a production line in Dafeng area was restarted, the overall operating rate of the market increased and the supply increased slightly. Overall, the cost side support is strong. It is expected that the viscose staple fiber market will continue to rise next week.
Rubber and plastic: PE and PP prices fell slightly. It is suggested to pay attention to Kingfa Sci.& Tech.Co.Ltd(600143)
PE: the price of PE raw materials fell continuously this week, and the price of PE fell slightly. Downstream demand is general, and there is a large backlog of inventory in port warehouses around the country. It is expected that the price will maintain a downward trend in the short term.
PP: the inventory of downstream enterprises was too high this week, and the price of polypropylene fell slightly. During the week, there was no significant change in the temporary shutdown and maintenance device compared with last week, and the market inventory is still at a high level. The polypropylene market is expected to remain weak and downward next week.
Others: the supply of organic silicon exceeds the demand, and the price of titanium dioxide is stable. It is suggested to pay attention to longmang group, Hoshine Silicon Industry Co.Ltd(603260) , Zhejiang Xinan Chemical Indusyrial Group Co.Ltd(600596)
Titanium dioxide: the operating rate of titanium concentrate is low this week, and the price of titanium dioxide is stable. Recently, large factories in Shandong have maintenance plans, which last for about 20-25 days, and the market supply has decreased. Under the influence of the expected reduction of supply and strong cost support, the price of titanium dioxide is expected to rise in the short term.
Organosilicon DMC: organosilicon supply exceeded demand this week, and the price continued to fall. The continuous decline in the price of metal silicon, the main raw material of organosilicon, has weakened the cost support. China's overall operating rate is about 90% and the supply is sufficient. With the release of supply, the market is expected to decline in the short term.
Risk tips
Policy disturbance; Technology diffusion; Breakthroughs in new technologies; Global intellectual property disputes; Global trade disputes; The tightening of carbon emissions brings the risk of catching up with production capacity; Risk of sharp decline in oil prices; The risk of a sharp economic downturn.
