Market Review
Last week, the basic chemical industry index rose 4.27%, the Shanghai and Shenzhen 300 index rose 2.23% in the same period, and the basic chemical industry index outperformed the market by 2.04 percentage points in the same period. The petroleum and petrochemical index rose 3.93%, outperforming the market by 1.70 percentage points in the same period. Among them, ST Dazhi (23.96%), Jiangxi Black Cat Carbon Black Inc.Ltd(002068) (22.74%), Yunnan Energy Investment Co.Ltd(002053) (20.85%), Cngr Advanced Material Co.Ltd(300919) (20.17%), Levima Advanced Materials Corporation(003022) (19.24%) ranked among the top five; The companies with the top five declines were: Shenzhen Dynanonic Co.Ltd(300769) (- 41.76%), Jiangsu Flag Chemical Industry Co.Ltd(300575) (- 33.43%), Liansheng chemical (- 23.56%), Shanghai Smith Adhesive New Material Co.Ltd(603683) (- 11.12%), Jiangxi Hengda Hi-Tech Co.Ltd(002591) (- 10.28%).
Key investment points:
Potash fertilizer: last week, the potash fertilizer market maintained a high level. According to the data of Baichuan Yingfu, as of May 20, the market transaction price of domestic potassium traders was in the range of 49505000 yuan / ton, the mainstream quotation of imported potassium was 62%, and the price of Russian White potassium port was about 5 Sichuan Dowell Science And Technology Inc(300535) 0 yuan / ton. On the demand side, it has entered the off-season of agricultural demand. The downstream market is mainly on-demand procurement, and the market transaction is relatively light. On the supply side, at present, the inventory of Chinese manufacturers is low. At the same time, due to the impact of the epidemic, the arrival volume of imported potassium fertilizer at the border trade port is limited, there is great uncertainty, the circulation in the spot market is still relatively tight, and the manufacturers are willing to support the price. Considering that the spot of potash fertilizer is still tight at present, and it is difficult to alleviate the shortage of potash fertilizer supply in the short term, it is expected that the subsequent potash fertilizer price will remain high. It is suggested to pay attention to relevant leading enterprises.
Soda ash: last week, the price of soda ash in China continued to rise slightly. According to the data of Baichuan Yingfu, as of May 20, the average price of light soda ash was 2883 yuan / ton, up 0.31% week on week and 8.18% month on month; The average price of heavy soda ash was 3000 yuan / ton, up 0.30% week on week and 5.71% month on month. On the supply side, at present, enterprises have sufficient orders on hand, mostly focusing on the completion of early orders and order sealing operation. In some areas, there is a tight spot supply in the market for device maintenance. On the demand side, the downstream demand is relatively stable, but in order to control costs, enterprises mostly focus on rigid demand procurement, and the market wait-and-see atmosphere is relatively strong. On the cost side, the price of raw salt decreased slightly last week, the price of synthetic ammonia began to callback, and the price of thermal coal increased slightly. Considering that the current main soda ash production areas are basically in high load operation, and the space for subsequent output increment is limited, under the condition of relatively stable demand side, there is still room for a small rise in soda ash price. It is suggested to pay attention to relevant leading enterprises.
Investment suggestion: in 2022, we will mainly recommend three main investment lines: 1 Under the background of policy control, production and supply are becoming more stringent, while the demand side is still supportive in various sub sectors, such as pesticides, fertilizers and refrigerants; 2. Resource based chemical industry segments that rely on new energy and seek industrial transformation and upgrading from upstream materials, lengthen their business cycle and improve valuation, such as phosphorus chemical industry; 3. High value-added new materials with significant domestic substitution trend, such as semiconductor materials and display materials, which are key planning during the 14th Five Year Plan period.
Risk factors: the risk of continuous fluctuation of international crude oil price, the risk of repeated impact of epidemic situation in some parts of China on enterprise operation, and the risk of sharp fluctuation of chemical product price.
