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Daily Market Review on Specified Futures Products 2019.11.14

Fang submitted 2019-11-14 15:10:15

Crude oil

Yesterday, the domestic main force 2001 contract of PTA continued to fluctuated weakly at low level, and the trend over evening session turned stronger. The main force 2001 contract of MEG went up and then fell sharply, and the upward pressure was still obvious after the rapid rise. As far as PTA is concerned, due to the recent decline in spot processing fees, some equipments began to reduce load or overhaul. Yesterday, the equipment of Taihua Xingye with 1,200,000 tons of producing capacity stopped producing for some reason, and the equipment of Yadong Petrochemicals was overhauled as planned. And the equipment of Pengwei Petrochemicals stopped producing temporarily. As for MEG, the spot price rose to ¥4,623 per ton yesterday, and the basis with 01 increased to ¥86 per ton, and the current loss of mainstream naphtha system still exceeded $30 per ton,. Overall, it is advised to hold a slight long position of PTA and pay attention to the long opportunity on MEG.

Raw materials of Polyester

Yesterday, the domestic main force 2001 contract of PTA fluctuated at low level, and the futures price was relatively weak. In comparison, the main force 2001 contract of MEG rebounded from the bottom and went up sharply with great volume and increasing positions over evening session, and the short-term trend was relatively strong. As far as PTA is concerned, the processing fee of spot PTA has fallen to ¥510 per ton around yesterday, and the price difference between PX and naphtha fell to below $260 per ton, and the industry chain profit was further compressed. As for the MEG, the current loss of mainstream naphtha system was almost $40 per ton, and the spot price has certain support due to the low inventory of East China Port. Overall, it was advised to hold a slight long position of PTA and pay attention to the long opportunity on MEG.

Iron ore

Currently, since steel mills generally start replenishing the warehouse from 1 to 1.5 months before the Spring Festival, steel mills have not started the replenishment yet. It should be noted that due to the prevailing pessimism in the early stage, the in-plant inventory of steel mills has been compressed to the lowest in the same period of history. Therefore, with the recent price falling back to below $80 per ton, the replenishment of the steel mill may start earlier at any time, so there is little scope for fundamentals to continue to deteriorate, but the specific time of replenishment is not easy to determine. Long positions are too concentrated in some main force contracts, and the risk of market hit by the withdrawal of long positions exists, which limited the space of price rebounding. The spot price at the port is currently equivalent to ¥655 per ton, at a premium of 7% in terms of the futures price.

Natural Rubber

The quoted price of Qingdao rubber in USD went down with weak inquiries. The offer of RSS3 was rare. The CIF of STR20 in February was $1,410 to $1,420 per ton. The spot price and CIF of SMR20 was $1,360 to $1,370 per ton. The CIF of mixed rubber from Thailand in February was $1,430 per ton. The quoted spot price of mixed rubber from Thailand in RMB was ¥11,200 to ¥11,200 per ton. Overseas rubber went down. The main force contract of JRU02 was flat with the last trading day and closed at 172.0. The main force contract of TF01 rose 0.8 or 0.58% and closed at 138.2. The SHFE Rubber fluctuated slightly. The main force contract of RU01 rose 15 or 0.12% and closed at 12,085, and the main force contract of NR02 rose 40 or 0.39% and closed at 10,265.


Jujiao News: Recently, Guizhou Tire announced that the its overseas wholly-owned grandchildren Company Qianjin Tire (Vietnam) Co., Ltd. plans to raise funds for the annual production of 1.2 million pieces of all-steel radial tires in Vietnam, and plans to apply for a fixed asset loan of no more than $150 million from the Guizhou Branch of the Export-Import Bank of China for a period of 8 years. Guizhou Tire intends to provide joint liability guarantee for the Vietnamese company's loan. Guizhou Tire's new factory in Vietnam is located in Longjiang Industrial Park, Qianjiang Province, Vietnam. The total investment of the project is 400 million US dollars. The planned total land area is about 301 acres, and the total construction area is about 137,300 square meters. After the project is completed and put into production, the annual production capacity of 1.2 million pieces of all-steel radial tires can be realized.


The supply of producing areas in Yunnan Province is sufficient. The latex price is reported to be ¥9,700 to ¥10,100 per ton, at a premium of ¥500 to ¥600 per ton in terms of the cup lump price. Recently, with the rise of absolute price of NR contract, delivery was attracted, and transaction of far-month contracts from January to March was relatively active in the spot market. As for the terminal market, it is heard that some tire brands have promoted price reduction policy under the inventory pressure of finished products, but it has not formed a large price cut in the market yet.


Futures Operation Advice: The SHFE rubber fluctuated slightly. As for the long position of the main force contract of RU01, it is advised to set a stop at the previous high level at 11,970 below.


(For reference only)



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