Crude oil rose unabated, and soda ash, phosphorus chemicals, organosilicon, metal silicon and refrigerants fluctuated after falling. On the other hand, semiconductors and new energy materials are highly concerned.
Industry trends:
Among the 101 chemical varieties tracked this week, 43 varieties increased in price, 29 varieties decreased in price and 29 varieties remained stable in price. The top five varieties were butadiene, aniline, methylcyclosiloxane, sulfur and vinyl acetate; The top five varieties of decline were phosphoric acid, dichloromethane, urea, raw salt and nitric acid.
WTI crude oil closed at US $84.83/barrel this week, with the closing price rising by 1.20% this week; Brent crude oil closed at US $87.90/barrel, closing up 2.14% this week. Affected by the gradual fading of market concerns about the impact of the Omicron epidemic, the geopolitical tension in Russia and Ukraine, the explosion of the Turkish oil pipeline and the IEA’s increase in global crude oil demand this week, crude oil recorded a slight rise and reached a new high in more than seven years. According to the US EIA data, as of the week of January 14, the US commercial crude oil inventory excluding the strategic reserve unexpectedly increased by 515000 barrels, higher than the expected decrease of 938000 barrels. In the future, the Fed’s expectation of accelerating taper remains unchanged. The market waits for the Fed’s interest rate meeting from January 25 to 26. The commercial crude oil inventory of OECD member countries is still at the lowest level in seven years, and the short-term oil price is expected to remain high and volatile.
Soda ash regained its upward trend this week. According to Baichuan Yingfu, the average market price of light soda ash closed at 2209 yuan / ton, with a weekly closing price increase of 2.46%. Affected by the small supply of low-cost goods in some areas and the high preparation enthusiasm of downstream photovoltaic glass manufacturers before the year, the demand for soda ash is good, and the transaction focus moves up slightly. At the same time, the overall operating rate of the industry this week was 75.5%. Henan Zhongyuan Chemical Phase II plant was shut down, while Chongqing Heyou industry gradually resumed operation; On the whole, the supply end of soda ash increased slightly. On the inventory side, the total inventory of Chinese soda ash manufacturers this week was 1.384 million tons, a month on month decrease of 119000 tons, which has decreased for the third consecutive week. In the medium and long term, with the promotion of the national policies of carbon neutralization and carbon peak, the photovoltaic glass industry line has been put into operation continuously, and the demand for soda ash by photovoltaic glass will increase rapidly in the past three years. Under the condition of limited operating rate and large increase of downstream photovoltaic installed capacity, it is expected that the soda ash price may rise in the medium term.
The price of yellow phosphorus stopped falling and rebounded this week. According to the data of Baichuan Yingfu, the average price of yellow phosphorus market closed at 30757 yuan / ton, up 4.00% from the closing of last week. In terms of supply, the output of yellow phosphorus this week (1.15-1.21) was 15420 tons, with a decrease of 0.58% on a weekly basis; The decrease in supply mainly comes from Leibo area, Sichuan. Leibo No. 1 major enterprise stops production for maintenance, and the main increase comes from Honghe, Yunnan. A new electric furnace is opened in Honghe area, resulting in an increase in supply; As of January 20, the operating rates of the three provinces were 63.03%, 66.85% and 55.96% respectively. From the demand side, due to the lower price of yellow phosphorus in the early stage, wait-and-see manufacturers actively enter the market for procurement, and have a high enthusiasm for inquiry. In terms of raw materials, the price of phosphate rock remains high; As of January 23, the average market price of phosphorus ore is 645 yuan / ton. It is expected that the price of phosphorus ore will continue to rise in the later stage, and the price of yellow phosphorus may be in a shock upward trend in the longer term due to the support of cost side and the impact of electricity price reform in Yunnan and Sichuan.
Investment suggestions:
This month’s view:
Cyclical industries: the price fluctuation of subdivided products increases. As of December 31, the prices of only 14% of the tracked products had increased month on month; 71% of product prices fell month on month, accounting for 11% with a decline of more than 20%; In addition, the price of 15% products was flat. As of December 31, WTI crude oil price fell 7.8% month on month, and Brent crude oil price fell 7.6% month on month. Industry data: the PPI index of the chemical industry in November was 119.1, down 0.6% from October. Since December, the overall price of raw materials has continued to decline, and the operating rate of some enterprises in Zhejiang has been limited by the epidemic. The central economic work conference was held in Beijing from December 8 to 10. The conference pointed out that the raw material energy consumption is not included in the total energy consumption control, and some coal chemical enterprises usher in development opportunities. Long term optimistic about the development of leading companies in the context of carbon neutrality.
Growth companies: the price of new material products remains high. Compared with the general correction of the price of bulk chemicals, the price of new materials such as EVA / DMC / NMP / PVDF / metal silicon / metal lithium remained high in December. For example, the price of battery grade lithium carbonate has exceeded 280000 yuan / ton, and the average monthly price has increased by 19%. On the other hand, China’s semiconductor material industry is in a period of rapid development, localization and substitution are continuously promoted, and China’s new production capacity can not meet the demand. Benefiting from the rapid development of downstream new energy vehicles, photovoltaic, semiconductor and other industries, the supply of some new materials in the upstream is tight or will become the norm.
Investment suggestion: looking forward to January, most chemical products prices are still facing correction pressure due to the impact of oil price and demand. From the perspective of sub industry prosperity, pesticides, infrastructure related chemicals, semiconductor materials and new energy materials are expected to maintain a high prosperity. From the perspective of valuation, after full adjustment, the valuation of private refining, industry leaders and other related chemical enterprises has returned to a low level again. In the medium and long term, with the sustainability of profits exceeding expectations, high-quality chemical assets are expected to usher in value revaluation. Recommended stocks: Wanhua Chemical Group Co.Ltd(600309) , Jiangsu Eastern Shenghong Co.Ltd(000301) , Rongsheng Petro Chemical Co.Ltd(002493) , Zhejiang Nhu Company Ltd(002001) , Zhejiang Huangma Technology Co.Ltd(603181) , Jiangsu Yoke Technology Co.Ltd(002409) , Shandong Hualu-Hengsheng Chemical Co.Ltd(600426) , Lianhe Chemical Technology Co.Ltd(002250) , Lier Chemical Co.Ltd(002258) , Crystal Clear Electronic Material Co.Ltd(300655) , Valiant Co.Ltd(002643) , Sobute New Materials Co.Ltd(603916) , Shandong Sinocera Functional Material Co.Ltd(300285) etc.
January gold shares: Valiant Co.Ltd(002643)
Risk tips
1) large fluctuations in oil prices caused by changes in geopolitical factors; 2) The global epidemic situation has changed.
