Fundamentals did not improve significantly

After the Spring Festival, PVC prices fell significantly, until the middle of April the largest decline of 21.8%. Since then, although the PVC rebounded, but the weak pattern is not completely reversed. In terms of the second quarter, the supply and demand pattern has the potential for improved stage, but the degree of improvement also limits the upstream height. Therefore, the trend of PVC up and down are limited.

New pattern of supply and demand pattern

First, capacity growth slowed down, supply and demand improved. Beginning in 2013, PVC industry began to self-repair capacity, then capacity decline year after year. Chlor-Alkali Industry Association data show that 2016 domestic PVC production capacity decreased by 220,000 tons, including new capacity of 890,000 tons, out of capacity of 1.11 million tons; production growth rate of 3.5%, demand growth rate of about 1%, supply and demand gradually from the imbalance For balance. According to statistics, this year plans to 2.96 million tons of PVC plant put into operation, but the actual production capacity may be less than expected. Late, the industry itself and the guidance of the policy will continue to play a role in the regulation, supply and demand continued to improve the possibility of a larger, less likely to take the blind expansion of the old road.

Second, from a net importer to a net exporter, exports become a new bright spot in demand. 2016 domestic net exports of 389,000 tons of PVC, the continuation of the net export pattern since 2014; from January to March this year, net exports of 123,300 tons, 2016 net exports over the same period 69,600 tons, net exports expanded year on year. According to UBS forecast, China 2017, 2018 PVC exports will account for the global PVC trade volume of 1.5%, 1.6%. Although the total export volume is not large, but the growth trend will constitute a certain positive support for PVC demand.

Third, the stage of supply and demand contradiction still exist. PVC season in the second quarter will reduce short-term supply, and the traditional demand for a rebound in the supply and demand there is a stage to improve the potential. However, the second quarter of the maintenance efforts year on year poor performance, social stocks are still high year on year, thus suppressing the ring to improve the positive.

Chlor-alkali imbalance again

Beginning in the second half of 2016, the situation of chlor-alkali imbalance re-emerged. The fourth quarter of 2016, caustic soda downstream alumina market volume and price go up, driving demand for caustic soda, caustic soda prices rose gradually since September. Data show that the fourth quarter of 2016 caustic soda production increased by 14.3% year on year, a 6-year high year on year growth rate, the same period caustic soda (32% ion membrane) prices from 690 yuan / ton to 970 yuan / ton, an increase of about 40% Substrate (≥96%) price increase is more than 30%.

In the fourth quarter of 2016, in the calcium carbide prices higher, traffic and environmental factors such as boost, PVC also appeared in the stage of volume and price Qi Sheng situation, industry profits have also been greatly improved, the overall profitability of the caustic soda industry showed a high level The However, did not last long, this year, PVC production growth has not been effectively digested. With the calcium carbide prices and caustic soda industry, high yield, PVC production continues to increase and prices continue to fall trend. With the decline in production profits of PVC, Shandong liquid chlorine market prices once appeared 400-600 yuan / ton of the situation, the caustic soda enterprises “to fill the chlorine” state.

In the short term, the caustic soda industry is driven by high profits, maintaining a high operating rate. Although the chlor-alkali plant maintenance in May increased, the output has declined, but the amount of downstream alumina is still relatively large, more aggressive procurement, liquid alkali prices to maintain high oscillation is more likely. Therefore, the short-term supply and demand in the case of chlor-alkali imbalance, PVC supply increased pressure on the price still exist, the price rise can only hope that the cost of boost and improve the consumption.

Support force still exists

In the long term, PVC is not too pessimistic. First of all, the cost of support or still have room to play. Calcium carbide prices since the beginning of the year has continued to decline in late April began to pick up (the beginning of the domestic average price of calcium carbide from 2830 yuan / ton all the way down to mid-April 2430 yuan / ton, the recent price rose 80-100 yuan / ton ).

Second, the seasonal consumption recovery has started. From the social inventory point of view, after the middle of April, PVC total inventory began to decline from 315,000 tons in mid-May to 27 million tons, although still higher than the 2016 stock in the same period 28.5%, but the downward trend More obvious. As the annual April to September is the PVC to the inventory stage, is expected under the action of the seasonal laws, the inventory pressure to ease the stage, the downstream consumption chain to improve the trend of the same.

Finally, in the long run, with the electrolytic aluminum industry to further promote the supply side of the structural reform is expected, do not rule out the deepening of the policy, alumina market capacity and demand decline, thereby reducing the demand for caustic soda. If the slowdown in demand for caustic soda, chlor-alkali industry operating rate decline, will ease the supply of PVC pressure. In this way, there will be a potential impact on the impact of PVC, but the specific extent of the policy is still subject to the implementation of the situation. For example, according to 1 ton of alumina corresponding to 0.241 tons of caustic soda demand, assuming that electrolytic aluminum production capacity by 5 million tons, corresponding to 9.75 million tons of alumina and 2.34 million tons of caustic soda demand, this part of caustic soda accounted for about 6% of total capacity.

Based on the above analysis, the second quarter of the late, PVC will continue the interval oscillation pattern, but the oscillation center of gravity is expected to move slightly, the price of 5300-5400 yuan / ton have some support, and the first target in the 6200 yuan / ton nearby.

Market research firm AlliedMarketResearch, a new report shows that the global nano-coating market in 2020 is expected to reach 13.094 billion US dollars, 2016 – 2022 annual compound annual growth rate of 21.0%.

Nano-coated nanomaterials are used as substrates, and these coatings provide weather resistance to protect the surface of the coating from deterioration. High-tech nano-coating is not only non-toxic harmless, but also can slowly release a substance, degradation of indoor formaldehyde, xylene and other harmful substances.

From the type of view, the function of nano-coating is different: anti-fingerprint, antibacterial, easy to clean and anti-fouling, self-cleaning (bionic and photocatalytic), anti-icing, anti-corrosion, conductive, UV, wear resistance, chemical resistance Erosion and so on.

From the application point of view, nano-coating covers the electronics, energy, food and packaging, construction, marine industry, military defense, automotive, aerospace, health care and other fields. The automotive industry has maintained the highest growth rate, while the Asia-Pacific market, the rising demand for cars, but also gives a good nano-coating market environment. The marine shipbuilding industry is the biggest potential to develop the market – the fouling caused by microbial growth will burn 40% of excess fuel, causing losses of up to £ 5 million per year.

From the geographical point of view, Brazil, Argentina and other Latin American countries accounted for the highest share of market revenue (51%). Latin America has a wealth of raw materials, harbor transport convenience, the automotive and aerospace industry investment is also expanding.

Strengthening technology research and development is the key force in the global nano-coating market, and now enterprises have developed ultra-thin nano-protective coating, both environmentally friendly and non-toxic, and has excellent anti-ultraviolet, durability and other properties. The United States is also developing the fourth generation of nano-technology coatings, it is understood that these nanotechnology coatings may become a military stealth paint to help fighters to achieve shaking reversal. In addition, the cost of nano-coating than the average paint reduction of 20% -30%, for the development of furniture, home appliances industry is also very helpful.

After a period of time crazy pull up, the domestic caustic soda (32% of the North China ion film factory price as an example) was raised to 990 yuan / ton, or a record high. But with the downstream enterprises to gradually increase the pressure on the goods, the northern region of caustic soda prices fell within a certain range, is still in the beginning of the downstream channel. Although the recent northwest, north China and other places chlor-alkali enterprises overhaul, supply and demand level market supply relatively tightened, but subject to the downstream market to receive efforts, the overall domestic caustic soda showed a trend of weakness.

After a period of time crazy pull up, the domestic caustic soda (32% of the North China ion film factory price as an example) was raised to 990 yuan / ton, or a record high. But with the downstream enterprises to gradually increase the pressure on the goods, the northern region of caustic soda prices fell within a certain range, is still in the beginning of the downstream channel. Although the recent northwest, north China and other places chlor-alkali enterprises overhaul, supply and demand level market supply relatively tightened, but subject to the downstream market to receive efforts, the overall domestic caustic soda showed a trend of weakness.

At present, the domestic market stability of caustic soda-based, local offer Yindie. Liquid base: the market price stability, downstream alumina and other industries to take the goods enthusiasm light stability. At present, the North China 32% ion film mainstream offer in the 880-1020 yuan / ton. Protopine: market stalemate, the Northwest region chlor-alkali manufacturers down the factory price, the market wait and see mood strong, Shandong area offer down, other markets temporarily stable, transactions in general. Northwest 99% of the mainstream offer in the 3850-4000 yuan / ton. It is expected that the price of caustic soda will not change in the short term, and some areas will fall due to poor delivery.

From the perspective of alkali chloride balance, the current liquid chlorine market in Shandong is still in the doldrums, some manufacturers freight subsidies to reach 600-800 yuan / ton, although a slight improvement in shipments, but the overall turnover is still stable atmosphere. Northwest region It is reported that the actual transaction also exists 800 yuan / ton of freight subsidies. Although the liquid chlorine downturn to a certain extent on the price of very caustic soda, but the current situation, the domestic caustic soda by a greater impact on supply and demand, especially the downstream manufacturers of alumina to kill the door. Although the current alumina manufacturers started higher, but the downward trend in market feedback has begun, caustic soda market is still bearish, short-term domestic caustic soda steady, slow down the market outlook, the overall rate of reduction is expected to 50-100 yuan / ton, after the domestic caustic soda Return to reason.

Early in March, the market decline in the market, the price slightly down, the stock began to accumulate; and April, is undoubtedly the process of increasing supply and demand contradictions; May, it is the full outbreak of price war, the market Heard. Nearly two months, ammonium chloride market continued to slump, in the down the road farther and farther, it is difficult to look back.

The current market decline in the ammonium chloride market is difficult to stop, while the soda ash market has experienced a sharp decline in the first quarter after entering the market decline in the market was narrowed, due to the drag of ammonium chloride market, the base enterprises began to suffer losses, ammonium chloride , Soda ash under the dual pressure, the base manufacturers do not intend to continue to cut prices. From mid-April, central and eastern China, some manufacturers of light base offer began to narrow a narrow range of 20-30 yuan / ton, the base of the enterprise aimed at the price of impairment. But from the cost, the base of the enterprise has begun to lose money, while the price of ammonium chloride also fell to a record low.

Union enterprises already losses, can no longer look at the stock up, the price fell. What should I do to save our ammonium chloride?

(A) limited production reduction

Union enterprises overhaul or loss of state, to maintain a normal and stable production of a small number of manufacturers. It is reported that the current market price of more than 100 tons of ammonium chloride stocks, individual manufacturers over 10 million tons of inventory. At present, downstream fertilizer companies due to the continuous callback of urea, some small and medium enterprises to promote the transaction, low-end prices re-released. In general, the compound fertilizer business warehouse more than in the middle of this month, but taking into account the continued decline in urea, corn acreage reduction, the reduction in demand and other factors, do not rule out some of the compound fertilizer business or early clearing, Ammonium purchase is limited. In the case of weak demand, some enterprises will increase their willingness to limit production, individual enterprises have begun to overhaul, for some time, the market shipping pressure will be slightly reduced.

(B) ammonium chloride exports

The domestic market continued to slump, so many manufacturers and traders began to find a new way out. From the export of ammonium chloride in March can be seen that exports are the first choice for many manufacturers and traders. According to customs statistics show: in March 2017 exports of ammonium chloride 140,400 tons, the export amount of 10,984,400 US dollars, the average price of 78 US dollars / ton. Exports increased by 153% qoq, an increase of 57%. Although the export price slightly down, but the domestic market continued to weaken, some dealers will still shift the focus to exports. Accompanied by the current manufacturers to limit the pace of limited production, exports to a certain extent, ease the pressure on the domestic market.

Also looking for export-positive particles of ammonium chloride, dry ammonium downstream products, the current northeast, Henan and other places have been reduced to the end of this month, the domestic demand for particulate ammonium chloride will basically end, some manufacturers And even the equipment has been shut down, but there are some manufacturers in order to transfer the pressure of ammonium chloride, the focus of ammonium chloride particles from the domestic transfer to exports.

On the whole, the current ammonium chloride market is not entirely good, but the face of severe market, these positive support for the market is limited, negative factors still dominate. It is expected that May ammonium chloride market is hard to change, will continue to run weak.

Asphalt spot market after a wave of decline after the current to maintain consolidation. The current downstream road project has not been focused on the start, the demand is still limited, mostly in the main inventory consumption, traders buying enthusiasm is not high, refinery inventory growth, mostly price sales. The market need to pay attention to whether the demand in late May after the start, from the disk point of view, backed by 2400 yuan / ton support, 1709 contracts have long opportunities to do more.

Inventory slightly higher

Since the beginning of the year, the asphalt refinery operating rate as a whole is low, the first quarter operating rate of only about 50%, at historically low; but since April, the refinery started to pick up, especially in mid-April operating rate rose to 60% ; But in early May fell again to about 50%. Data show that as of May 3 the week, the major domestic asphalt refinery operating rate of 56%. Among them, the South China, Southwest and Northwest region operating rates are about 70%, which is better with the needs of the western region is directly related to the Northeast and the operating rate of about 60%; Yangtze River Delta and Shandong operating rates are about 50%. Overall, the recent domestic asphalt refinery started short-term recovery, but the overall is still not high, is expected in late May after the demand improved, the refinery start level is expected to further rise.

On the other hand, the refinery started to pick up but the demand did not follow up, traders demand for procurement decline, resulting in refinery inventories began to increase from the beginning of April, as of May 3 week, refinery stocks increased to 34% Regional stocks increased to about 40%, northeast, Shandong and the Yangtze River Delta region increased to about 35% of the stock, Northwest stocks increased to about 25%.

Asphalt refinery profits rise

This year, as oil prices fell and asphalt prices rose, asphalt and crude oil prices are also rising, which means that the refinery profits compared with 2016 is also improved. According to the statistics of the river, the first quarter asphalt refinery profitability, theoretical profits continue to improve, to the beginning of May theoretical profit reached 392 yuan / ton, the overall higher than last year’s profit level. But we believe that the late refinery profits difficult to have greater room for growth, because the third quarter crude oil trend is expected to be strong, and the asphalt is difficult to have a larger upside, so the refinery profits are expected to increase is limited.

Demand in the western region is bright

In the near future, infrastructure projects in the western region have been started to reduce the demand for asphalt terminals. The demand for asphalt in the western region has continued to rise. The refinery inventory in the northwest and southwest regions has been lower, traders and owners have increased demand for high quality asphalt. But the demand for other regions is still relatively limited, the lower road construction projects started less, traders increased inventories, refinery shipping pressure. In addition, South China and Southwest and other places affected by rainfall, the project construction is difficult to effectively carry out, to suppress the market will. In the case of poor overall market demand situation, the refinery may still increase the recent efforts to promote the shipments, but the overall price range is expected to not be too much. In the future, we expect the overall market demand in May to be improved in April, with particular attention to whether there will be substantial changes in asphalt demand since mid to late May.

March imports of asphalt has increased

Since late March, imports of asphalt prices have changed the previous situation, South Korea and Singapore imported asphalt are down. Singapore asphalt May cargo two major brand prices are down, CIF fell 17.5 yuan / ton to 345-360 yuan / ton, the dutiable value of 2800-2950 yuan / ton. South Korea asphalt cargo prices in May there are different rates of decline, the East China CIF fell to 295-320 US dollars / ton, dutiable value in the 2550-2700 yuan / ton, low prices and parts of East China asphalt prices basically flat. In March, domestic imports of asphalt increased over the previous two months, imports in March more than 400,000 tons, much higher than the import level in January and February.