Chemical production reduction, inventory reduction, cost support
Through combing can be found that the first half of the kerosene chemicals also showed different performance. "For kerosene chemicals, the impact of coal chemicals on the cost is more direct, the disk logic and the pace of change of coal is very synchronized, especially methanol, urea these coal chemicals, some of the market start is basically determined by the price of coal." The transmission chain of petrochemical products is relatively complex, the olefin feedback is weak, the aromatic hydrocarbon is supported by the oil logic, the feedback of PTA and other varieties is still strong, and the market sometimes is out of line with the price of crude oil, and the trend is relatively independent." Nanhua Futures (10.510, 0.25, 2.44%) can chemical director Dai Yifan said.
"In the second quarter, the operation logic of leading oil-to-chemical products is still repair, mainly reflected in two aspects of supply and demand." According to Lu Jiaming, a senior analyst at Shenwan Futures, in 2023, the increase in supply pressure is an objective existence for most oil-based chemicals. At present, after a period of maintenance balance, the supply and demand situation of some varieties has improved, such as polyolefin, but there is still pressure on the inventory of some varieties, such as PVC. From the demand side, in the second quarter, with the continuous introduction of consumption encouragement policies, the demand side is also gradually repaired.
The reporter learned in the interview that compared with the second quarter, the keywords affecting the trend of chemicals in the third quarter are production reduction, inventory removal, and cost support.
"In 2023, production capacity for most chemicals continued to expand and prices for most chemicals fell sharply as demand failed to match supply growth." Liu Shuyuan, futures analyst at CITIC Construction and Investment (23.490, 0.11, 0.47%), said that if there is no significant production reduction in the upstream in the third quarter, or there is no high energy consumption capacity reduction, chemical prices will remain at a low level for a long time, or further break down.
It is understood that at present, due to the market expectations are not optimistic, the industrial chain is mostly in the active destocking stage. In Dai Yifan's view, the industrial chain holds goods and the willingness to stock them is very low, which is both pressure and opportunity.
"Destocking is a long-term trend that runs through the fundamentals of chemicals this year." Lu Jiaming said that due to the weak supply and demand of most chemicals this year, when this trend occurs, the market will be more cautious about the procurement of chemicals, and the market waiting for low-price procurement opportunities will also have a negative effect on the spot price, and the situation of low-price storage will further increase.
"Once remote expectations are reversed, short-term restocking could lead to higher demand for many chemicals." Dai Yifan said that under the premise of no significant change in policy or remote expectations, it is difficult to reverse the weakness of chemicals, and the trend of most varieties is still expected to be anchored energy, and cost changes are still one of the key factors in the trend of chemicals in the third quarter.
Since most chemicals are currently operating at historically low prices, whether the cost side can form support in the process of price decline has attracted the attention of the market. "From the perspective of market operation, the varieties with little supply and demand pressure have a certain cost support effect in the short term, but the varieties with obvious supply and demand pressure, the market will worry more about the future cost of the formation of a new drag on chemicals." Lu Jiaming said.
Dai Yifan believes that the pricing of coal chemicals still closely follows the cost end, and oil chemicals need to pay close attention to the clear signal of the weakening of the oil end. With the mass production of PDH, the pressure of olefin monomer gradually increases, so the expected performance of the future market is relatively poor.
In Liu Shuyuan's view, at present, most of the positive or negative basically cash to the 09 contract price, the market needs to pay attention to whether there are new variables in the third quarter. "For example, whether the domestic chemical demand can be gradually warmed, and whether the upstream has obvious parking or negative situation due to long-term losses." 'he said.
For the overall trend of chemicals in the third quarter, although market participants are generally not optimistic, the valuation of many varieties is already at a low level, and under the background of low valuation, the price of chemicals is more limited.
Dai Yifan said that from the perspective of oil chemicals, the current highest valuation is still PTA, and follow up closely on whether the maintenance and oil adjustment logic is weak. The contradiction of the rest of the coal chemicals is general, the third quarter will be strong demand expectations and high inventory reality switch back and forth, the overall wait-and-see.
"In view of the current situation of chemicals, the logical change in the third quarter and the first half of the year is not large, and the demand is not driven by a clear reversal." In the context of the market is difficult to exceed the expected policy, the price of most chemicals has limited room for rebound, and is expected to remain mainly weak." Dai Yifan said.
Similarly, Liu Shuyuan also believes that kerosene chemicals will continue to be weak in the third quarter, and the main contradiction in the market is not on the supply side, but on the demand side. "Against the backdrop of a weak economic recovery, domestic residents' demand for durable or FMCG goods is limited, and companies' orders have shrunk, leading to a significant improvement in the prices of corresponding goods." 'he said.
（The above information was transferred from the Futures Daily）
