Crude oil

Crude oil: U.S. crude oil and refined oil inventories increased slightly

Yesterday EIA announced inventory data. Among them, crude oil, gasoline, and distillate inventories increased slightly, and the refinery operating rate returned to 76%. The impact of the cold wave on the refinery has not completely subsided. It is expected that the US refinery operating rate will not return to the cold wave until April. The current operating rate is still about 10% lower than the previous 85%. The recent strong gasoline cracking spread is mainly due to the rise in RINS prices, the suspension of refinery production, and the recovery of consumption. A series of factors have combined to cause a rapid decline in US gasoline inventories, which has now fallen. The historical low level in the same period, but in the future, with the recovery of refinery production and the increase in gasoline supply, we believe that the strength of gasoline gap may be unsustainable. The strong gasoline in the United States is still caused by regional factors. Globally, gasoline supply and demand are not tight.

Strategy: Bullish cautiously; Brent intertemporal positive set or unilateral multi-match

Risk: Iranian oil returns to the market ahead of schedule, and oil-producing countries substantially increase production

Iron Ore

Iron Ore:

The position on I2105 contract closed at ¥1069 per ton, the spread of Iron 5-9 contract is ¥154.5 .

In terms of spot, the PB powder in Rizhao Port was ¥1,126 per ton, the discounted SSF price was ¥1180 per ton.

【Important News】

1. Mysteel: On March 16, Chen Sheng, general manager of Rio Tinto Iron Ore China, said that Rio Tinto’s railway and port operating capacity reached 360 million tons, exceeding the current production capacity. This year, there are fewer typhoons and more rain in Australia. The delivery efficiency has not been affected.

2. Mysteel: Vale launched the operation of the tailings filtration plant in the Davarren Comprehensive Operation Zone. This is another important progress Vale has made in stabilizing iron ore production and restoring its annual production capacity of 400 million tons by the end of 2022.

【Trading strategy】

1. At present, iron ore port inventories continue to accumulate, but the extent has decreased. In terms of weight, the stock of coarse powder remains high; shipping data shows that the shipment of Australia and Pakistan increased by 1.34 million tons from the previous month, and the overall shipment was stable and rising; In terms of demand, Hebei is greatly affected by air pollution control policies. Many steel plants have production capacity reduction plans and have strong implementation efforts. At the same time, the recent increase in steel plant maintenance has resulted in a significant decrease in molten iron output, with an average daily molten iron output of 2.4060 million tons. Port Logistics has increased slightly, but it is still at a low level in previous years. The demand for hot coils at the finished product end is good, and the elimination is expected. The extent of thread accumulation is gradually decreasing. Although the emergency response to heavy pollution weather in Tangshan area is lifted, most of the long-process steel mill blast furnace equipment is still in a state of limited production, and the specific production time It has not yet been determined, and the output of molten iron will become a key variable in the later stage. Strategically, unilateral recommendations are mainly to hold the current position for the time being.

2. Arbitrage: long heat coil and short iron ore; long steam coal and short iron ore.

(For reference only)

PTA

PTA: PTA: The maintenance amount increases slightly; the PTA processing fee is low.

Balanced watch prospects: 3-April TA maintenance plan concentrated, the first time entered a slightly reservoir, TA processing fee is expected to see the bottom;

Strategic recommendation: (1) Single side: hold the current position. (2) Duration: hold the current position.

Risk: From the 3-April PTA factory maintenance plan, the sustainability of the gasoline premium on the improvement of the supply and demand of aromatics.

Natural Rubber

Rubber: Downstream acquisitions increase, and port inventory continues to decline

On March 17th, the most active traded RU contract closed at 12,195 (+295) yuan/ton, the price of mixed rubber was 13,050 (+200) yuan/ton, the basis of most active traded contract was -700 yuan/ton (-150); the open interest of top 20 active traded long positions was 72,250 (-2062) lots and the short position was 110133 (-2797), net short position was 37,883 (-735).

On March 17th, the most active traded NR contract closed at 12,195 (+295) yuan/ton, the STR in Qingdao Free Trade Zone was 1,865 (+35) US dollars/ton, the SMR was 1,835 (+40) US dollars/ton, and the SIR was 1,755 (+40) US dollars/ton. The basis of most active traded contract was -791 (-44) yuan/ton.

As of Mar 12th, the total inventory of the exchange was 175,162 (+78) lots, and the warehouse receipts of exchange were 170,780 (+2680) lots.

Raw materials: sheet rubber 62.89 (0), cup lump 46.7 (+0.15), latex 65 (+0.5), RSS3 66.49(-0.28).

As of Mar 11, the domestic all-steel tire operating rate was 76.85% (+1.73%), and the domestic semi-steel tire operating rate was 72.6% (+1.04%).

Opinion: The futures prices have stabilized yesterday. There is a lot of news about rubber tree powdery mildew in the main producing areas of Yunnan. However, as far as the official release is concerned, it is still delayed in the Xishuangbanna area, and other areas are basically normal. The impact is not overestimated for the time being, and from the perspective of futures market performance, NR is stronger, or it mainly reflects the current demand is good. The operating rate of domestic tire factories and the port acquisition can also be basically confirmed. The pattern of good demand has not changed. The short-term variables are on the supply side. However, from the current price of concentrated milk and the expansion of domestic concentrated milk production capacity, it is expected that the situation of raw material preemption can still be maintained for a period. Therefore, the pressure on domestic warehouse receipts after delivery is difficult to manifest. It is expected that the supply side will have to wait until after the overseas cut, short-term prices may fluctuate in line with the macro atmosphere. From a mid-line perspective, the global low-yield period will continue to April and May, while domestic and overseas demand is gradually recovering, the supply and demand pattern is still good, and the futures price stabilizes, it is recommended to try a small amount of long position.

Strategy: Bullish cautiously

Risks: a substantial increase in production, continued accumulation of inventories, and a substantial decrease in demand.

Copper

Copper

LME copper prices closed at $9130/ton, up by $206.5/ton, an increase of 2.31% and decreased 3899 lots to 310,000 lots.

【Important News】

1. The Fed maintains the scale of bond purchases and predicts that the benchmark interest rate will remain near zero until the end of 2023. Chairman Powell expects that inflation will only be a temporary phenomenon, and there is no need to over-respond to the rise in Treasury bond yields. Powell remains silent on whether to extend the supplementary leverage ratio (SLR) exemption. Seven of the 18 Fed officials expect to raise interest rates before the end of 2023. After two more Fed reiterated its easing stance than in the December meeting last year, bond traders increased their bets on rising economic growth and inflation. Wells Fargo expects 10-year U.S. Treasury yields to reach 2% soon

2. The White House adviser revealed that Biden's tax reform plan will impose higher taxes on businesses and wealthy Americans, while providing relief for middle-class families. US Senate Minority Leader McConnell: It is impossible for the Republican Party to support tax increases to pay for Biden's large-scale infrastructure plan. In addition, if the Democrats abandon the lengthy debate process in order to advance Biden's agenda, the Republicans will take retaliatory action.

【Trading strategy】

1. The Federal Reserve issued an interest rate decision overnight to maintain the scale of bond purchases. The dovish remarks exceeded market expectations. The current copper market is still prone to rising and falling, but a trend line market has not yet formed.

2. Arbitrage: At present, copper consumption has not fully recovered, and high copper prices have also restrained some copper consumption. The supply of copper scrap is abundant. Copper is still in the warehouse stage, and the arbitrage market is temporarily to hold the current position.

3. Options: sell put options, that is, sell CU2105-P-60000

(For reference only)