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Daily Market Review on Specified Futures Products 2020.03.06

Fang submitted 2020-03-06 09:55:56

Crude oil

The overnight international crude oil surged first and then retreated, and the Brent contract in May once again fell below the mark of $50 per barrel. Although OPEC issued a statement that it will reduce its daily supply by an additional 1.5 million barrels and extend the production reduction agreement to the end of the year, Russia has not expressed its position on the above results, which has also led investors to worry that OPEC+ meeting may not reach a consensus agreement today. Judging from OPEC's resolution, both the reduction of output and the implementation time of the production reduction agreement have exceeded market expectations, but the main focus at this stage is still Russia's attitude. In general, we believe that in the case of a huge shock on the demand side, due to self-interest considerations, Russia has a higher probability of compromise.

Raw materials of Polyester

Yesterday, the domestic main PTA2005 and MEG2005 contracts continued the weakly fluctuated trend, and there was no clear direction for future prices. From the demand side, the terminal production and sales dropped to around 50% to 60% yesterday, and overall demand is still recovering weakly. As to PTA, the PTA spot processing fee was stable at 550 yuan per ton, and the processing fee of the 2005 contract was around 670 yuan per ton, and the selling pressure on futures was obvious, the number of registered warehouse receipts has risen to more than 110,000 lots. 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 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, the plats price returned above $90 per ton, favorable conditions have been included in the price after the initial price rebound, and there were scarce speculation opportunities. As reality contradictions come closer, 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 retreat in the medium term. It is advised to focus on the impact on the future price from big changes in the major funds’ positions. At present, the port price of golden bubba powder is equivalent to 690, and the futures price was at a discount of about 3.5%.

Natural Rubber

Overseas rubber fluctuated. The main force contract of TF05 rose by 0.6 or 0.46% to 131.3. The main force contract of JUR08 fell by 1.8 or 1.03% to 172.2. The SHFE rubber went up slightly. The main force contract of RU05 rose by 60 or 0.54% and closed at 11,120, and the main force contract of NR05 rose by 10 or 0.11% and closed at 9,390. The quoted price for Qingdao rubber in USD fluctuated with active inquiries. The quoted price of RSS3 was $1,620 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.

CPCA: In February, retail sales of passenger cars decreased by 80% year-on-year. In the first week of February, the retail market for passenger cars was frozen, and the average daily retail sales were 811 vehicles in the first week of February, a year-on-year decrease of 96%, which were at a low level in the first week. The retail sales in the second week of February reached an average of 4,100 vehicles per day, a year-on-year decrease of 89%. The retail sales in the first two weeks of February fell 92% year-on-year, and the retail market recovered slowly. The retail sales in the third week of February reached an average of 5,411 vehicles per day, a year-on-year decrease of 83%. The third week's retail sales increased by 32% compared with the second week, and the market recovery rate was not too fast. Retail sales in the fourth week of February reached an average of 16,000 vehicles per day, a year-on-year decrease of 63%. Among them, there were also uploads of accumulated orders finished at the end of last month after opening.

In terms of synthetic rubber, the supply support of butadiene by Lotte’s plant explosion in South Korea has not yet appeared, and domestic quotations have not fluctuated much. It is understood that the plant's annual production capacity of butadiene is 150,000 tons, accounting for about 11% of South Korea's total production capacity. According to the latest data released by Zhuochuang, the domestic all-steel operating rate is 47.8%, and the relative increase in production is 9.8% from the previous week. It is important that the year-on-year reduction in production has rebounded from -64.5% in February to -34.5% currently.

Futures Operation Advice: The SHFE rubber fluctuated. As for the main RU05 contract, it is advised to hold the long position and set a stop at the recent low level at 10,960 below.

(For reference only)

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