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Daily morning for Crude oil, PTA, natural rubber, iron ore, copper Iro (ZH & EN) 20210713

Fang submitted 2021-07-13 10:00:39

Iron ore: Global supply fluctuates at a high level, and foreign demand is at a high level.

Opinion and logic:

Yesterday, China's domestic iron ore futures and spot prices both rebounded slightly. The most-active iron ore contracts rose and then fell, closing at 1,188.5 yuan/ton, an increase of 17 yuan/ton, or 1.45%. The spot price showed an increase ranging from 2-17 yuan/ton. Qingdao Port Pb fines closed at 1,480 yuan/ton, low-grade SSF reported 1,042 yuan/ton, the spread between medium and high grades is still at an absolute historical high. Yesterday, the port spot transaction was 1.014 million tons, an increase of nearly 18% from the previous week, but the overall transaction was still at a normal low level. In terms of data, the total arrival volume of China’s 45 ports reached 22.76 million tons, a decrease of 2.367 million tons from the previous week. The total arrival volume of the six northern ports was 11.069 million tons, an increase of 453,000 tons from the previous week. According to Mysteel statistics, Australia and Brazil shipped 23.759 million tons of iron ore, a week-on-week decrease of 1.147 million tons. Australia’s total shipments were 16.235 million tons, a decrease of 1.865 million tons from the previous week. Among them, Australia sent 12.77 million tons to China, a decrease of 2.811 million tons from the previous week and Brazil’s total shipments amounted to 7.524 million tons, an increase of 718,000 tons from the previous week. The total global shipping volume was 30.027 million tons, a decrease of 1.759 million tons from the previous week. Arrivals and shipments have decreased simultaneously, and there will be no supply pressure in the short term.

Recently, China's domestic steel companies have intensified their production cuts, and the market has different attitudes towards iron ore. Optimists believe that the current iron ore spot inventory is still in a healthy state, structural contradictions are still prominent, and the supply is difficult to increase significantly. On the contrary, pessimists believe that if domestic production restrictions are strengthened, then the output of molten iron will drop significantly, which will affect iron ore demand. In addition, the current iron ore price is at a high level in recent years, and the ore supply will be relatively guaranteed. Both the long and short sides have their own basis, but the market seems to be more optimistic. The reason is that even if the output of crude steel is reduced, the first step is to adjust the addition of scrap steel by steel companies. The shutdown of the blast furnace is a backup option, so the actual demand for ore in the medium and short term will not deteriorate rapidly.

On the whole, the domestic and international supply and demand of iron ore have been in a tight balance since the beginning of this year, and high domestic and foreign consumption has been supporting the strong operation of iron ore prices. Looking ahead to the future, under the overall production restriction pattern, it is difficult for iron ore prices to have the strength to rise as the thread and hot-rolled coil end, and the price direction of iron ore depends on the strength of domestic production restrictions. If the intensity of production restriction is small, due to the current tight global supply and demand of iron ore, the price is likely to continue to run on the strong side. If the production restriction of crude steel is strong, iron ore inventory is expected to continue to accumulate, which will gradually turn the supply and demand pattern into oversupply, and subsequent prices are expected to run weaker. In the short term, due to the large basis difference, the iron ore market price is expected to move closer to the spot price under the pattern that the price of the thread and hot-rolled coil is rising steadily. Therefore, it is recommended to be cautiously bullish in the short-term, but do not increase open interest at high prices, and a small amount of positions could be established when market prices are low.

Strategy: None

Unilateral: Cautiously bullish in the short term

Cross-species: None

Inter-period: None

Spot-Futures Arbitrage: None

Options: None

Concerns and risks:

1. The intensity and policy orientation of the production limit on the thread and hot-rolled coil end;

2. Low-season demand performance at the thread and hot-rolled coil end;

3. The epidemic situation may aggravate, etc.

Rubber: Driven by the market, raw material prices rebounded slightly.

On July 12, the most-active RU contract closed at 13,310 (-5) yuan/ton, the price of mixed rubber reported 12,000 (-50) yuan/ton, and the basis of most-active contract stood at -235 yuan/ton (+105); the open interest of top 20 actively traded long positions was 103,537 (-2,420) lots, the short position was 154,803 (-30) lots, and the net short position was 51,266 (+2,390) lots.

On July 12, the most-active NR contract closed at 10,670 (+10) yuan/ton, the STR in Qingdao Free Trade Zone reported 1,655 (-5) US dollars/ton, the SMR stood at 1,640 (-15) US dollars/ton, and the SIR figure was 1,605 (0) US dollars/ton. The basis of most-active contract reported -272 (-5) yuan/ton.

As of Jul 9: the total inventory of domestic exchanges was 188,158 (+3,872) lots, and the amount of warehouse receipts of exchanges was 174,550 (-100) lots.

Raw materials: Sheet rubber 50.7 (+0.19), cup lump 42.75 (+0.35), latex 43.8 (+0.30), RSS3 52.3 (+0.07).

As of Jul 8, the operating rate of domestic all-steel tire factories was 43.6% (-1.68%), and the operating rate of semi-steel tire factories was 44.51% (-0.24%).

Opinion: Driven by the favorable domestic RRR cut last weekend, the price of rubber dropped from high. Driven by market prices, the spot market rebounded yesterday and overseas raw material prices also rebounded. Last Thursday, after the spread between RU September and January contract narrowed to less than 1,000 yuan/ton, the spread widened again, which may mean that the short-term logic of the rolling has been completed. Last week, the RU non-standard spreads also widened following the rebound in futures prices, reflecting the weak demand in reality. Coupled with the gradual increase in supply during peak seasons, the loose fundamentals of rubber market have not improved significantly. Rubber prices may return to a weak pattern, but in terms of the absolute value of overseas raw material prices, they are still at a low valuation. In addition, the recent rains will also bring about the firmness of raw material prices, which may also limit the downside of rubber prices.

Strategy: Neutral

Risk points: production may increase sharply, inventory may continue to accumulate, and demand may fall sharply.

Crude oil: Saudi Arabia and the UAE have yet to resolve their differences.

From the perspective of the outcome of the OPEC meeting in the future, we believe that there are several possibilities in the future:

1. The countries will reach an agreement, but the content of the agreement will be adjusted, such as separating the production increase plan and the extension of the production restriction plan. This is also an important requirement of the UAE, that is, it is not opposed to increasing production. However, if the production restriction agreement is to be extended, the UAE's production benchmark must be increased. This result may cause the current pace of increasing production by 400,000 barrels per day per month to remain unchanged, but the production restriction agreement will only last until the end of March next year.

2. Production quotas in various countries will be readjusted. Due to the disruption in the UAE, it is unlikely to adjust the UAE's production benchmark alone. It is expected that the quota ceilings of various countries will be adjusted. Such a result may lead to a monthly increase of more than 400,000 barrels per day, but the time limit for the production limit agreement may extend to the end of next year.

3. The parties cannot compromise, and OPEC is still unable to reach a new production increase plan, making the existing agreement continue. This result is most beneficial to oil prices.

We believe that the probability of occurrence of the first situation is still the highest, because the changes to the existing proposal are minimal, and it is much more troublesome to re-negotiate the production quotas of countries.

Strategy: neutrally bullish; go long positions of INE crude oil and short positions of Brent or WTI futures

Risks: The Iranian nuclear agreement may be reached quickly or OPEC may increase production beyond expectations.

Copper: Changes in fundamentals are limited, and copper prices remain stable.

Spot: According to SMM news, yesterday's spot market premiums and discounts showed a trend of first rising and then falling. In the morning market, the inter-month basis once reached about contango 180-200 yuan/ton, which attracted some arbitrageurs to enter the market for anti-arbitrage opportunities. In addition, due to tight supply in the market, Standard-Grade Copper began to report a premium of 270-280 yuan/ton in the morning session, and market transactions were active. However, downstream consumption was suppressed under the pattern of high market prices and high premiums, and there were few large purchases in the market, which led to the contraction of the basis narrowed to around contango 130 yuan/ton after the second period. Although the premiums and discounts fell rapidly to 240-260 yuan/ton afterwards, it is still difficult to see the bidders. Even if there is a small amount of 220 yuan/ton quotation in the late trading, it is still difficult to have a large number of transactions. The supply of High-Grade Copper and Hydro-Copper market is relatively scarce, leading to the overall price stabilization. High-Grade Copper reported a premium of 260-300 yuan/ton, but the limited price/performance ratio led to few large transactions. Hydro-Copper is quoted at a premium of 180-220 yuan/ton, but there are few downstream buyers, and the market has limited trading activity.

Opinion: The market was relatively calm yesterday, and the US dollar index fell slightly. Due to the news of the central bank's RRR cut last weekend, although the price of non-ferrous metals, including copper, received some support, the effort was relatively limited. Compared with the equity market, the performance of different varieties in the non-ferrous metals sector basically still revolves around their respective fundamentals. Copper varieties are currently under pressure from ample supply, but at the same time, there is a current rebound in demand that was suppressed in the previous second quarter due to high prices. Therefore, the current copper price still maintains a volatile pattern.

In the medium and long term, macroeconomically, the global central banks will continue to maintain the current ultra-loose monetary and fiscal policies in the short term. Although the U.S. dollar has moved strongly after the interest rate meeting, it is largely an overdraft for future economic growth. In terms of fundamentals, the current TC price continues to rise, coupled with the domestic rumor of tapering, so the supply side has a relatively negative impact on copper prices. On the demand side, China’s current control of the epidemic is still very successful, and the new energy and new infrastructure sector will continue to drive copper demand. However, due to the current market interference from the rumors of the Federal Reserve tapering and the possible tightening of central bank liquidity around the world, in general, we recommend that investors maintain a relatively neutral attitude.


1. Unilateral: neutrally

2. Inter-market: postpone

3. Inter-period: postpone

4. Options: postpone

Focus point:

1. The Fed's monetary policy orientation

2. The trend of the US dollar index

3. Whether the demand in the second quarter can meet expectations

4. Policy risks may increase.

PTA: The production and sales level of polyester is still low, and processing fees are still weak.

Balance sheet outlook: The inflection point of PTA inventory accumulation will gradually appear in mid-to-late July, making PTA enter the re-accumulation cycle; PTA processing fees may be weaker in the future. The accumulation rate of PX inventory in July is limited, and it is expected that the space for compression of PX processing fees is limited.

Strategic recommendations: (1) Unilateral: cautiously bullish; (2) Intertemporal: The open interest of the 09 contract has gradually decreased, and the speculative sentiment in the previous period has weakened. The market will gradually transition from a trading model in which the open interest of the 09 contract is larger than the volume of delivery warehouse order to a trading model when the inflection point of the accumulated inventory is expected to arrive in August. In terms of 9-1 spreads, the investment strategy suggests adopting reverse arbitrage when market prices are high.

Risks: The implementation of the PTA plant maintenance plan, the strength of replenishment of terminal speculation, and the sustainability of the improvement in the supply and demand of aromatics due to the gasoline premium.







单边 :短期谨慎偏多



















铜:基本面变化有限 铜价维稳





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