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Daily Market Review on Specified Futures Products 2020.07.24

Fang submitted 2020-07-24 10:10:15

Crude oil

Judging from the shipment volume of Russian Ural crude oil in early August, it still remained at around 700,000 barrels per day, or even slightly lower than the shipment volume in July. On the whole, OPEC+ still controls exports more strictly. The previous expectations were more consistent. OPEC+ began to shift from controlling production to controlling exports. However, on the other hand, China’s crude oil procurement is currently slowing down, and the recent domestic floods have led to weak demand for refined oil. The market is still worried that the increase in China’s refined oil will affect the global market. From the current point of view, the market is still a pattern of tight crude oil and loose refined Chinese pine. In terms of operation, it is advised to maintain the neutral strategy.

Iron Ore

The position on I2009 contract decreased by 3,026 lots and closed at ¥838.0 per ton, the position on I2101 contract increased by 1,419 lots and closed at ¥761 per ton.

Important Information

1. Australia's Mount Gibson Mining Company (Mount Gibson) released its second quarter operation report. The report shows that the iron ore sales in the second quarter of 2020 were 1.158 million tons (wet tons), an increase of 12.9% from the previous quarter and an increase of 90.8% from the same period last year. The company's iron ore sales were 4.942 million tons (wet tons) in the 12 months of the 2019/20 fiscal year (July 2019-June 2020).

2. The latest data from the General Administration of Customs shows that in June 2020, China exported 2.2 million tons of steel sheets, down 31.1% year-on-year; cumulative exports from January to June were 17.57 million tons, down 14.9% year-on-year. In June, China exported 400,000 tons of steel bars, down 42.3% year-on-year; from January to June, China exported 3.95 million tons, down 28.7% year-on-year.

3. In terms of spot, the PB powder in Rizhao Port is ¥850 per ton, and the golden bubba powder in Rizhao Port is equivalent to ¥906 per ton.

Trading Strategy

1. Arbitrage: This week, the port inventory has clearly accumulated, and the port pressure has also increased to a certain extent. From the perspective of pig iron, there is still a small increase, and the overall rigid demand for iron ore is still high. Australia's recent shipments are in line with the seasonal decline, and the overall pressure on arrivals is expected to ease in the later period. However, due to the high cumulative port pressure in the early period, it is expected that inventory in ports will not decline significantly when the port pressure eases, and the current price difference between card powder and PB has been narrowed, and the price difference between PB and Golden Bubba is also narrowing. The upward drive of the spot is weakened, it is advised to hold a slight position on long 01 hot rolled and short 01 iron ore.

2. Option strategy: The upward drive of iron ore is weak, it is recommended to wait and see temporarily. (For reference only)


The terminal operating rate increased, while whether it can continue remains to be seen.

In the context of PTA still having processing profits, the possibility of additional overhauls at Yisheng and Tongkun has decreased, combined with the reduction in polyester production, which quickly accumulated in July to August. In terms of the unilateral strategy, it is expected to fall gradually; for the strategy across varieties, it is estimated that PTA in July and August will once again accumulate 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, the 9-1 reverse cash and carry strategy was under pressure and close to the rolling window at -200. 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

RU: The main force contract of RU09 rose by 65 or 0.61% and closed at 10,675. The Japan market was closed due to the holiday. Yunnan WF closed at 10,450 to 10,500 yuan/ton, Hainan SCRWF closed at 10,500 yuan/ton, the second standard rubber closed at 10,200 yuan/ton, and Thailand’s RSS3 closed at 12,750 to 12,850 yuan/ton.

NR: The main force contract of NR10 rose by 65 or 0.75% and closed at 8,715. The main force contract of TF10 rose by 0.1 or 0.08% closed at 121.3. The quoted price for Qingdao rubber in USD fell slightly by $5 to $10 per ton with normal inquiries. The spot price or CIF of STR20 was $1,250 per ton. The CIF of SMR20 in November was $1,300 per ton. The CIF of mixed rubber from Thailand in December was $1,305 per ton.

The Ministry of Industry and Information Technology: Recently, the "Beijing-Tianjin-Hebei and Surrounding Area Industrial Resource Comprehensive Utilization Industry Coordinated Transformation and Upgrade Plan (2020-2022)" was issued. The plan points out to promote the efficient use of waste polymer materials. Implement standard conditions for waste tires and waste plastics industries, build a number of projects for retreading used tires, preparing fine rubber powder, and pelletizing recycled plastics, and cultivate a number of processing and utilization leaders in Dingzhou, Hebei, Jinan, Shandong, Jiaozuo, Henan, and Pingyao, Shanxi enterprise.

Today coincides with Japan Sports Day, and the local financial market is closed. In terms of synthetic rubber, latex polystyrene butadiene continued to weaken, while butadiene stabilized and rebounded, continuing to compress processing profits. According to Zhuo Chuang's statistics, the latest domestic all-steel operating rate was 69.9%, the week-on-week (relative) production increased by 1.6%, and the year-on-year (relative) production was reduced by 5.0%. The monthly operating conditions continued to improve and the reduction in production narrowed.

Futures Operation Advice: The main contract is rolling, and the position decline on RU09 contract is not obvious. For the long position on RU01 contract, it is advised to set a stop at the previous low level at 11,690.

(For reference only)

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