Crude oil

The overnight international crude oil surged first and then dropped, and Russia's failure to express its position on further reductions in oil prices led to a downward pressure on oil prices. In yesterday's OPEC + Technical Supervision Committee meeting, Saudi Arabia proposed to reduce output by at least 1.2 million barrels, but there is news that Russia is opposed to a substantial increase in output cuts. This uncertainty has weighed on oil prices. However, we believe that at this stage Russia only has different opinions on the extent of production reduction and the allocation of production reduction quotas. In the end, OPEC+ has a higher probability of reaching an agreement to deepen production reduction. The meeting will give the answer today and tomorrow. In general, in the case of a significant shock on the demand side, the joint operation of OPEC+ will support a repairing rebound in oil prices.

Raw materials of Polyester

Yesterday, the domestic main PTA 2005 contract fluctuated slightly, while the main MEG2005 contract weakened and fluctuated downward. Overall, the two are still in a weak operation trend. From the demand side, the terminal production and sales dropped to around 70% yesterday, and overall demand is still recovering. However, due to the decline in the upstream PX price and the stability of the PTA spot, the PTA spot processing fee rose sharply to 550 yuan per ton yesterday, and the processing fee of the 2005 contract rose to nearly 700 yuan per ton, which will lead to increased selling pressure on futures. From the point of view of MEG, since March, new plants of Hengli Petrochemical and Zhejiang Petrochemical will be included in the total production capacity, and the newly added production capacity of the two will be nearly 2.6 million tons, which will put pressure on capacity expansion. In general, we believe that the demand side is gradually recovering, but the pressure on the supply side is still obvious. It is advised to pay attention to the OPEC+ meeting today and tomorrow, and close the long position bought previously when price rebounds.

Iron ore

Yesterday the iron ore rebounded with increasing positions of futures, and market sentiment fluctuated sharply. In general, favorable conditions have been included in the price after the initial price rebound, and the speculation sentiment temporarily came to an end. The price will return to the fundamentals of real supply and demand, and the main market divergence is whether the total demand for iron elements will decline after the epidemic. In short term, with the overhaul of blast furnaces at large domestic and foreign steel mills, competition in the iron ore seller market has increased, and the contradiction between the actual inventory turnover of steel mills may also be transmitted upwards recently, and the iron ore may continue to drop. At present, the port price of golden bubba powder is equivalent to 685, and the futures price was at a discount of about 4%.

Natural Rubber

Overseas rubber fluctuated at the bottom. The main force contract of TF05 fell by 0.3 or 0.23% to 130.7. The main force contract of JUR07 fell by 3.5 or 2.01% to 170.5. The SHFE rubber went lower. The main force contract of RU05 rose by 35 or 0.32% and closed at 11,060, and the main force contract of NR05 rose by 10 or 0.11% and closed at 9,380. The quoted price for Qingdao rubber in USD fluctuated with general inquiries. The quoted price of RSS3 was $1,600 per ton. The spot price or CIF of STR20 was $1,340 to $ 1,350 per ton. The CIF of SMR20 in August was $1,370 per ton. The CIF of mixed rubber from Thailand in July was $1,380 per ton.

The Ministry of Industry and Information Technology of China: As of 24:00 on March 3, the operating rate of the major production bases of 16 key vehicle groups has reached 84.1%, and the resumption rate of employees has reached 66.5%. Except in areas with severe epidemics, enterprises in the automotive industry have basically resumed work and production. Eleven key enterprises of negative pressure ambulances across the country have organized the production of 1,847 negative pressure ambulances and sent 690 units to Hubei.

The latest NINO 3.4 index in February closed at +0.5°C, and the El Nino report continued. The main producing areas in Southeast Asia are mainly dry climate. Recently there has been a small amount of rainfall in the Yunnan region of China, which is also generally dry. During the epidemic prevention period, local tapping personnel were under control. Many factors may cause their tapping time this year to be delayed compared to that of previous years (mid to late March).

Futures Operation Advice: The SHFE rubber fluctuated. As for the main RU05 contract, it is advised to long a slight position and set a stop at the recent low level at 10,900 below.

(For reference only)