Crude oil

Affected by OPEC+ production cuts, the crude oil spot market is still strong. The export volume of Russian Ural cargoes has dropped to 800,000 barrels/day. The crude oil floating positions in the North Sea and West Africa are being quickly cleared by the market. Although the global floating position is still increasing, it is mainly due to the stagnation of China's overbought crude oil in the port. After excluding Asia, the number of crude oil floating positions in other regions continues to decline. Due to the tight supply of crude oil in the Middle East and the former Soviet Union, the premium is high. At present, the purchase price in Asia has begun to increase the purchase of North Sea, West Africa and U.S. crude oil. It is expected that the arrival volume in Asia in July and August will increase significantly. We believe that although the oil price will rise to US$40/barrel, China’s procurement will slow down significantly. Imports in June soared to about 14 million barrels/day, which will decline from July. However, due to the supply and demand gap caused by OPEC+ active production reduction, it is currently difficult for crude oil to fall smoothly. In terms of operation, it is advised to maintain the neutral strategy.

Iron Ore

The position on I2009 contract decreased by 3,872 lots and closed at ¥747.5 per ton, the position on I2101 contract increased by 2,555 lots and closed at ¥674.5 per ton.

【Important Information】

1. According to the steel industry PMI surveyed and released by the China Iron and Steel Logistics Professional Committee, it was 49.3% in June, a decrease of 1.6 percentage points from the previous month. The momentum of the early recovery of the steel industry has slowed down.
2. The Baltic Dry Bulk Freight Index rose 5 points, or 0.3%, to 1799 points on Tuesday. The index rose about 257% in June. Capesize freight index fell 5 points to 4320 points. The Panamax freight index rose 1 point to 1257 points.
3. On the morning of June 30, the mobilization meeting for the start of the Guangzhou-Zhanjiang high-speed railway line was held at the location of the starting well of the Zhanjiang Bay Submarine Tunnel in Potou District, Zhanjiang City, signifying that the western Guangdong region will connect A big step forward. The Guangzhou-Zhanjiang high-speed railway has a new main line of 401 kilometers, with an estimated investment of 99.8 billion yuan, a designed driving speed of 350 kilometers per hour, and a construction period of 5 years.

4. In terms of spot, the PB powder in Rizhao Port is ¥770 per ton, and the golden bubba powder in Rizhao Port is equivalent to ¥817 per ton.

【Trading Strategy】

1. Arbitrage: Last week, the shipment of vale has increased significantly, and the proportion of shipments to Europe has also increased. In July, the supply pressure will be reduced after the seasonal decline in Australian shipments. However, Brazil’s high shipment continuity needs to continue to pay attention, and thread demand is still in the off-season. There may be a reduction in pig iron in the later period, and the spot drive may weaken. It is advised to long contract of 2101 of hot rolled and short contract of 2009 of iron ore with small volumes.

2. The demand for short-term accumulation of building materials has weakened significantly. It is recommended to consider selling 2009 call options, that is I2009-C-800. (For reference only)

PTA

Hengli's new production capacity is gradually fulfilled, but the basis has strengthened slightly.

Prospects of the balance sheet: follow-up maintenance expectations and large swings in production, two separate hypothesis estimates. 1) Yisheng and Tongkun have carried out additional maintenance, and continued to remove the warehouse slightly in July. The nodes that accumulated inventory moved to August. (2) The additional overhauls of Yisheng and Tongkun failed to be fulfilled, so they ended removing a small amount of warehouse in June and re-entered the accumulation phase in July. In terms of operation, it is advised to wait and see for unilateral strategy; for the strategy across varieties, it is estimated that PTA in July will accumulate a small amount of warehouse. Chemical products are generally in the accumulation phase in July, and PTA has no obvious difference in strength, but it pays attention to the willingness of upstream factories to maintain and control under the background of low processing fees; for strategy across period, Yisheng Tongkun's maintenance expectations in July-August assume that the inventory level after de-stocking is still high, the warehouse receipt pressure is still there, and maintains expectations of selling 2009 and buying 2101. It is advised to wait and see, as well as focus on PTA factory inspection and fulfillment wishes of July to August, and the downstream restocking space.

Natural Rubber

About RU: The main force contract of RU09 rose by 10 or 0.10% and closed at 10,190, The main force contract of JRU10 rose by 0.1 or 0.07% and closed at 152.1. Yunnan WF closed at 9,900-10,100 yuan/ton, Hainan Whole Milk closed at 10,000 yuan/ton, the second landmark of production closed at 9,900 yuan/ton, and Thailand’s tobacco tablets closed at 12,300-12,400 yuan/ton.

About NR: The main force contract of NR09 rose by 5 or 0.06% and closed at 8,600. The main force contract of TF09 rose by 0.5 or 0.43% and closed at 116.6. The quoted price for Qingdao rubber in USD was narrowed with general inquiries. The spot price or CIF of STR20 was $1,220 to $1,250 per ton. The CIF of SMR20 in August was $1250 per ton. The CIF of mixed rubber from Thailand in October was $1270 per ton.

Hxchem.Net: Chinese state-owned enterprises intend to invest in the construction of a rubber glove factory in the Thailand Rubber Bureau Park in Nakhon Si Thammarat, covering an area of 20,000 Lai, with a planned annual production of 1.8 billion pieces. More details and investment models are currently being negotiated. China also negotiates with the Board of Investment (BOI) to adjust the conditions to attract investors. The current investment model is that (China) state-owned enterprises account for 51%, and private enterprises account for 49%, using domestic rubber raw materials for production.

As of mid-June, Japan's TOCOM delivery stocks were destocked and closed at 8,843 tons, an increase of 129 tons. According to data from the Rubber Bureau of Thailand, the current state-owned rubber stock in Thailand is 104,000 tons, occupying a budget of 126 million baht/year, which is lower than the average of 193 million baht/year or 34.7% less than the previous 4 years.

Futures Operation Advice: With the slow recovery overseas, for the main force contract of RU09, it is advised to hold large quantities with small volumes and stop the loss at low position recently. (For reference only)