From the perspective of digesting inventory, the current floating warehouses are relatively smooth to clear. Especially the floating warehouses in Europe and the US Gulf area have been basically cleared. The floating warehouses in the Asia-Pacific region mainly come from Chinese stagnation tankers. But from the global onshore inventory, it can be seen that the current decontamination rate is slow and the overall satellite inventory remains high. According to URSA satellite data, the utilization rate of China's domestic crude oil storage capacity is close to the limit of 70%, which will restrict China's crude oil imports in the coming months. However, the current market supply is also tight, so the market maintains a fragile balance. We believe that the inflection point may be in August. On July 15th, the OPEC Minister held a video conference to discuss the reduction of production. According to the current forecast, the scale of future production reduction will be reduced from 9.6 million barrels/day to 7.7 million barrels/day. However, we still need to pay attention to the meeting next week. In terms of operation, it is advised to maintain the neutral strategy.
The position on I2009 contract increased by 9,106 lots and closed at ¥796.5 per ton, the position on I2101 contract increased by 3,852 lots and closed at ¥717.5 per ton.
1. In June, China issued 286.7 billion yuan of local government bonds. Among them, the issuance of general bonds was 169.1 billion yuan, and the issuance of special bonds was 117.6 billion yuan; according to usage, the issuance of new bonds was 84.5 billion yuan, and the issuance of refinancing bonds was 202.2 billion yuan. From January to June, the local government bonds issued by the country were 348.64 billion yuan. Among them, general bonds were issued 11.139 trillion yuan, and special bonds were issued 237.25 billion yuan; according to usage, new bonds were issued 276.9 billion yuan, and refinancing bonds were issued 699.5 billion yuan.
2. The Federation of Passenger Carriers: The retail sales of the passenger car market reached 1.654 million units in June, an increase of 2.9% from the previous month’s retail sales, thereby achieving a sustained four-month retail sales growth from March to June; from January to June 2020 The national retail market for passenger cars totaled 7.7 million units, with a year-on-year decline in retail sales of 23%. The cumulative sales volume this year was a net decrease of 2.24 million units, accounting for approximately 11 percentage points of total retail sales last year.
3. In terms of spot, the PB powder in Rizhao Port is ¥803 per ton, and the golden bubba powder in Rizhao Port is equivalent to ¥843 per ton.
1. Arbitrage: According to the data from Zhaogang.com, both long- and short-term process production have declined, and production reductions have also declined. Overall, the inventory has shifted from cumulative to declining. Today’s construction materials sales have rebounded, and demand has shown signs of recovery. The pressure is expected to ease, and the accumulation of port inventory is mainly due to the large accumulation of lump ores and pellets. The pressure of fine ore is limited, and the range of iron ore discount is still relatively large. It is recommended to cash and carry arbitrage on 2101-2105.
2. Option strategy: It is recommended to consider selling 2009 put options, that is I2009-P-750. (For reference only)
Polyester inventory pressure gradually emerges, filament continues to expand losses
Prospects of the balance sheet: Under the background that PTA still has processing profits, the possibility of additional overhauls at Yisheng and Tongkun has decreased. Combined with the reduction of polyester production, it will remove the warehouse in June and accumulate quickly 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. The performance of the cross-species may be weak, but the willingness of the upstream factory to maintain and control should still be judged based on the change in processing fees; for strategy across period, Yisheng Tongkun's July-August maintenance assumptions are still high after cashing. 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.
About RU: The main force contract of RU09 rose by 80 or 0.75% and closed at 10,730, The main force contract of JRU10 rose by 0.2 or 0.13% and closed at 157.2. Yunnan WF closed at 10,400-10,550 yuan/ton, Hainan Whole Milk closed at 10,450 yuan/ton, the second landmark of production closed at 10,150 yuan/ton, and Thailand’s tobacco tablets closed at 12,700-12,850 yuan/ton.
About NR: The main force contract of NR09 rose by 25 or 0.67% and closed at 8,910. The main force contract of TF09 fell by 1.1 or 0.92% and closed at 121.2. The quoted price for Qingdao rubber in USD rose steadily and slightly by $5 per ton with general inquiries. The spot price or CIF of STR20 was $1,250 to $1,260 per ton. The CIF of SMR20 in November was $1290 per ton. The CIF of mixed rubber from Thailand in November was $1310 per ton.
ANRPC report: Since mid-January 2020, COVID-19 has caused a sharp decline in global demand, which is also the key factor that caused the natural rubber price to fall abnormally. According to statistics, in the first half of 2020, global natural rubber consumption fell by 15.7%. Among them, China, which accounts for 40% of global demand, consumed 20.1%. But gratifyingly, in the third quarter of 2020, global consumption of natural rubber will increase by 1.4% year-on-year, entering a positive value.
As of June, the NINO 3.4 index closed at 0.0°C and the near-end climate was normal, somewhere in the middle of the El Niño and La Niña reports. Hainan's glue fell back after a short period of time. At the current low end, it was reported at 11,200-11,400 yuan/ton, and the premium of Yunnan glue was +1,000 yuan/ton (previous peak was nearly +5,000 yuan/ton).
Futures Operation Advice: For the main force contract of RU09, it is advised to hold large volumes in short term and the stop loss should be moved up to the recent high of 10610 points. (For reference only)