Market Trend Forecast of 12 Chemical Sub-sectors

The industry pattern is concentrated, and the prices of MDI, DMF and other products have risen more than expected

Investment Advice

We suggest that we can pay attention to the following two types of targets: one is the price increase to determine the target that exceeds expectations, and the second is the high-growth target with a reasonable valuation. Regarding the price increase target, we believe that it needs to meet the demand to recover better + the inventory is better depleted + the supply-side competition pattern is better, and the synergy is better. There is a greater probability that the price will rise beyond expectations. After analysis, we believe that the best The variety is MDI, and the relevant subject is Wanhua Chemical (October Golden Shares of China International Finance Chemical). Regarding high-growth targets with reasonable valuations, we recommend focusing on the leading silicone additives, Xinyaqiang, automotive urea leading Longpan Technology, and adhesives leading Huitian New Materials.

Basic chemical key sub-industry tracking

Fertilizer industry

The demand for fertilizer preparation gradually increased, and exports supported a slight upward trend in urea products. This week, Shandong and Lianghe products were quoted at 1720-1780 CNY/ton, an increase of 20-100 CNY/ton from last week. It is about to enter November. Some areas of China, such as Northeast and Xinjiang, are gradually opening up off-site storage purchases to support domestic demand. At the same time, the printing of the standard has been implemented, and the domestic bid has exceeded expectations, supporting the continuous increase in urea prices; this week, the average daily output of urea was 147,800 tons, which was down from the previous month, and the supply pressure was weakened. It is recommended to pay attention to the impact of environmental protection on domestic production and winter storage purchases; this week Phosphate fertilizers run relatively smoothly, the supply of the industry is weakened, and inventory pressure is less. The supply of the monoammonium industry is relatively stable, and the weekly start is maintained at 57.54%. The diammonium is affected by the shutdown of some devices, and the industry supply support weakened; while overseas demand continued, export demand The support is strong, gradually entering November, with a small amount of winter storage purchases. With the gradual opening of purchasing demand, product cost support gradually rises, and manufacturers have a strong sentiment for price. It is recommended to pay attention to the follow-up winter storage purchases.

Coal chemical industry

The industrial structure is concentrated, and the operating status of coal chemical products is relatively high, and bulk products are weak and fluctuating. Methanol fluctuated within a narrow range this week. The downstream MTO started smoothly, but the traditional demand products started slightly, and the demand support weakened slightly. While the methanol supply rose slightly, the industry operating rate increased to 65.32%, the MTO started smoothly, and the methanol support was stable. , The price of methanol fluctuates slightly on a weekly basis; the price of ethylene glycol has been under pressure this week, and the raw material ethylene and naphtha have fallen. The cost support of ethylene glycol is limited, and the product price has fallen. The East China spot price is between 3710-3820 CNY/ton. Gradually entering November, after continuous procurement in the downstream, the transaction weakened slightly, and the start of ethylene glycol increased. The overall operating rate was about 59.31%, of which 62.78% of ethylene and 52.85% of coal increased significantly compared with last week. , The demand is relatively stable, and the product price operation is slightly under pressure; the price of acetic acid is relatively stable this week, the industry supply has not changed, the industry operating rate remains 86.08%, the downstream demand support is stable, the corporate inventory is temporarily reasonable, the acetic acid industry pattern is concentrated, and the product price Slightly rising; DMF supply is orderly, the concentration of enterprises is high, and product prices continue to rise. The textile and apparel industry gradually enters the peak season in the second half of the year. In the first half of the year, enterprises orderly control volume shipments, with the withdrawal of Jiangshan devices, the industry structure is optimized, and product prices remain stable. Since August, downstream demand has gradually improved, product prices have been strong, industry shipments are still relatively orderly, supply is limited, demand support, inventory pressure is not large, traditional product DMF prices have continued to rise, and downstream demand has continued in October. The Anyang plant restarted at the end of September, and Hualu’s new 100,000-ton plant was commissioned. It is expected that the short-term products will maintain strong operation. At present, the downstream slurry of the product maintains a high operating state and continues to consume product inventory. Product demand is well supported. It is expected to be in the short term Support product prices fluctuate at a high level.

Viscose staple fiber industry

The start of production has gradually increased, and prices have remained high: September and October are peak seasons for traditional textile and apparel product demand. This year’s epidemic has a greater impact on the textile and apparel sector in the first half of this year. However, the viscose industry started at a low level in the early stage, and the industry’s inventory was gradually digested, and product demand improved sequentially. , Provides room for product price recovery. Since August, the downstream demand for viscose has gradually recovered. In September, the industry entered the peak demand season, downstream procurement increased, and manufacturers' orders were sufficient. On the supply side, viscose production enterprises continued to rise to 80.95% this week, and product losses were partially alleviated. However, there is no significant profit for the time being. The company has been cautious about starting operations. The inventory decline is relatively limited. Supply has increased. The supply shortage of the industry has been slightly eased. It is expected that the short-term operation will continue to be strong.

Spandex industry

Costs continue to rise, cost demand is supported in both directions, and prices continue to rise. In the second half of the year, the demand for terminal clothing gradually increased. The downstream demand digested the accumulated inventory in advance, which reduced the inventory pressure of the product. Entering the second half of September, the company began to gradually increase the demand for products that gradually increased downstream. At present, the spandex industry started to 88 %, basically the same as last week. The prices of the two major raw materials of spandex, pure MDI and PTMEG, have both increased significantly, and cost support has increased. At the same time, industry inventories have continued to decline since mid-to-late August, and have fallen to more than 21 days this week. Inventory pressure is small, superimposing downstream demand support With stronger efforts, spandex products rose sharply. This week, the quotations of spandex products generally rose by 1,000-2,000 yuan, and the transaction price center increased. It is expected that the short-term price of spandex will run strongly. It is recommended to pay attention to changes in terminal demand.

Propylene oxide industry

Propylene oxide has been adjusted downward. The local mainstream in East China is now remitted to the price of 17800-18000 CNY/ton. On the supply side, although the main equipment in Shandong unexpectedly reduced the load, the Huatai plant gradually reduced the load and stopped, and the load of the Changling plant dropped to a low level, but as the Jishen plant resumed normal Level, the supply is hedged against each other. On the downstream side, the current downstream terminal prices remain unabated, the enthusiasm for purchasing in the market is not good, the pace of on-site buying is slow, and under the long-short game, there is no lack of expectations of weak market prices.

PVC paste resin industry

The mainstream price of glove materials in East China is 24000-25300 CNY/ton. The transaction price of the glove material market is strong, and the manufacturers have good shipments. Some companies still focus on returning orders. The fundamentals of the supply and demand of glove materials have not changed much, and the price is expected to be strong. Domestic PVC paste resin is delivered to East China at a mainstream price of 15000-17000 CNY/ton this week. The main factors for the price decline of some manufacturers are: on the one hand, the overall market is abundant, and the manufacturers mostly focus on shipments, and the prices are loose; the other is In terms of downstream demand, the demand is slightly weak, and more are maintained at the time of use.

Aggregate MDI industry

This week, the domestic aggregate MDI market rose strongly. Shanghai Huntsman announced the November listing price of 23,600 CNY/ton. Shanghai BASF and Wanhua Chemical also increased their November listing prices to 25,000 CNY/ton. The domestic MDI was in the maintenance season, and the supplier still has the right to speak, and the supply of goods is overall tension. Pure MDI: The domestic pure MDI market fluctuated at a high level this week. Shanghai Covestro’s weekly guidance price is 29,000 CNY/ton, Shanghai BASF announced that the bulk water price in November will not be less than 29,000 CNY/ton, and the barrel price will not be less than 32,000 CNY/ton. The supply of goods is tight, Huntsman and Wanhua Chemical Announced the November listing price of 28,000 CNY/ton, an increase of 8,200 CNY/ton from October. The supply side inventory is not suppressed and the market is firm.

Pesticide industry

In terms of pesticide prices this week, glyphosate was quoted at 22,500 CNY/ton, a slight increase from last week's 21,500 CNY/ton; the market price of glufosinate this week was 150,000 CNY/ton, unchanged from the previous week. In terms of pesticides, lambda-cypermethrin technical report reported 150,000 CNY/ton, which was the same month-on-month; lambda cypermethrin technical price was 50,000 CNY/ton, the same month-on-month, and bifenthrin was quoted at 193,000 CNY/ton, which was the same month-on-month ; The price of cypermethrin technical is 100,000 CNY/ton, which is the same month-on-month; the price of pymetrozine is 170,000 CNY/ton, which is the same month-on-month. The price of pyrethroids upstream of bentine acid methyl ester was 60,000 CNY/ton, which was the same month-on-month, the market price of kungfu acid was 150,000 CNY/ton, which was the same month-on-month, and the price of ether aldehyde was 95,000 CNY/ton, which was the same month-on-month. In terms of fungicides, chlorothalonil technical price was 26,000 CNY/ton, which was the same month-on-month; difenoconazole was priced at 190,000 CNY/ton, which was the same month-on-month; Pyraclostrobin was quoted at 160,000 CNY/ton, which was the same month-on-month; methyl Thiophanate was quoted at 35,000 CNY/ton (white), unchanged from the previous month, and carbendazim was quoted at 36,000 CNY/ton (white), unchanged from the previous month.

Dyestuff industry

Prices continue to remain stable. The price of disperse dyes is stable this week, and the mainstream market price of disperse black ECT300% is currently 25-27 yuan/kg. On the raw material side, the prices of m-phenylenediamine, cobalt chloride, and cobalt sulfate are relatively stable; on the demand side, printing and dyeing plants mainly purchase rigid demand, and traders cautiously wait and see. We expect disperse dye prices to remain stable in the short term.

Titanium Dioxide Industry

The concentrated stocking period of the downstream quarter is approaching, and prices continue to rise. This week, the market price of titanium dioxide rose steadily. At present, the mainstream price of sulfuric acid rutile titanium dioxide market is 13500-15000 CNY/ton, the mainstream price of Anatase titanium dioxide is 1100-12500 CNY/ton, and the current price of chloride titanium dioxide is It is 16500-18000 CNY/ton. On the demand side, the large downstream factories' centralized procurement and export sales are optimistic. Manufacturers have insufficient stocks and full orders, and dealers have to wait in line. On the raw material side, the price of titanium ore continues to be high. This week, the sixth round of titanium dioxide price adjustment this year has been launched. Since Longqi did not send a letter of price adjustment news, more than 20 manufacturers have issued titanium dioxide price adjustment letters, ranging from 700-1200 CNY/ton. The cost of titanium dioxide continues to be high, and the spot market continues to be tight. The peak season of "Silver Ten" may be extended, and the market price of titanium dioxide may return to the level of the beginning of the year. However, due to the particularity of the domestic and global markets this year, there are some uncertainties in the market at the end of the year.

Vitamin industry

Epidemics abroad have reduced demand for vitamins, and vitamin prices have fallen.

VA: The price of VA continued to decline this week. The current domestic VA500 market price is 330-360 yuan/kg, the price index broke a new low, and the European VA1000 market price is 75-79 euros/kg. Affected by the international epidemic, the VA market has experienced an oversupply situation, coupled with a large number of purchases in the second and third quarters of the market, some traders hold low-priced VA sales inventory, and dealers have kept quotations lower. It is expected that domestic VA prices will continue to be at the bottom with no significant improvement in demand in the short term.

VE: The price of VE has declined this week. At present, the mainstream price of VE in the domestic market is 58-62 yuan/kg, and the price of European market traders is 6-6.5 Euro/kg. At present, the downstream purchasing intention of the VE market is not high, and the domestic vitamin E market price is weakening. It is expected that the price of VE will continue to be low in the short term.

VD3: This week, the domestic price of VD3 has been lowered. The current mainstream price of vitamin D3 in the domestic market is 140-160 yuan/kg, and the European market price is 18-19.5 euros/kg. On the demand side, the downstream tends to take a wait-and-see attitude, purchases are relatively cautious, and mainly replenish goods in an appropriate amount on demand. Some manufacturers have raised their quotations in the early stage, but they have not promoted market development. Recently, the VD3 market has been operating quietly. We expect that VD3 prices may continue to decline in the short term.

DMC industry

Sufficient supply combined with falling prices of raw materials, the prices fell slightly. DMC prices fell this week, and the mainstream transaction price range was between 10300-11700 CNY/ton. On the supply side, Dongying Shunxin and Yunhua green energy installations stopped, and the overall supply was slightly reduced, but the new capacity installations were operating stably, and the overall supply was relatively sufficient; on the demand side, polycarbonate and electrolyte solvents were mainly used, and the demand was relatively high. Stable, with rigid demand mainly; on the cost side, the price of propylene in Shandong has fallen by 384 CNY/ton from the average price of last week, the price of propylene oxide has fallen by 611 CNY/ton from the average price of last week, and the price of methanol is the same as the average price of last week. The average price of product propylene glycol this week fell by 71 CNY/ton from last week's average price. Overall, the cost support has weakened. The price of dimethyl carbonate is expected to continue to decline next week.

Crude oil market tracking

International oil price trends

Last week, the average settlement price of Brent futures was 39.22 US dollars/barrel, down 3.13 US dollars/barrel, or -7.4%, and the fluctuation range was 37.65-41.2 US dollars/barrel. Last week, the average settlement price of WTI futures was US$37.57/barrel, a month-on-month drop of US$2.99/barrel, or -7.37%, and the fluctuation range was US$36.17-39.57/barrel.

Industry review

Last week, the price of petrochemical products increased the top five styrene, spandex 40D, styrene, PTMEG, nylon DTY; fell the top five international naphtha, fuel oil, international gasoline, PTA, international diesel. The top five prices of chemical products rose for pure MDI, polymeric MDI, DMF, liquid chlorine, and PP; the top five fell for sulfuric acid, propylene oxide, flexible foam polyether, TDI, and HDPE.

Last week, the price spread of MEG-ethylene, butadiene-liquefied petroleum gas, butadiene-naphtha, DAP-phosphate rock & sulfur & synthetic ammonia, PET-MEG&PTA&PET chip spreads increased significantly among the product spreads that Guojin Chemical focused on tracking; butyl acrylate -The spread of Acrylic Acid & n-butanol, acrylic acid-propylene, coal urea-synthetic ammonia, butadiene rubber-butadiene, TDI-toluene & nitric acid, has narrowed significantly.

Last week, the petrochemical sector underperformed its index (-1.05%), and the basic chemical sector underperformed its index (-6.74%).