Downstream enterprises to purchase at low prices

Since mid-February, Shanghai copper to expand the band to adjust the market, the focus shifted down. The current round of copper prices fall in the March-May consumption season, from the surface to see the consumption season is not busy, China’s bonded area seems higher also confirmed this point. But the current round of copper prices fell slowly, there is no large number of empty one to suppress the situation, and the price did not break down the previous low. Therefore, the overall view, the market there is a big difference: bearish that high inventory will eventually suppress the copper price, see more that China’s copper consumption is acceptable, copper prices do not have a substantial decline in the foundation. We through the field and telephone research, tend to the latter point of view, that the late emergence of copper prices have a greater probability of recovery.

Copper supply tight pattern has not changed

Earlier, the Escondida copper mine strike in Chile, the Peruvian Cerro Verde copper mine strike, and the Indonesian restrictions on copper exports, plummeted copper production. Recently, BHP Billiton’s Cerro Colorado copper mine also has a strike plan. In the long run, the decline in phased copper production will affect the annual copper concentrate supply, the market conservative estimate 2017 copper concentrate long single processing fee TC will drop to 80 US dollars / ton, indicating that the future supply of copper concentrate Tighten. In addition, the copper mine strike not only affected the production of copper, but also increased the cost of copper mining.

Refined copper and scrap copper narrowed

Scrap copper relative to the advantages of refined copper weakened, the current difference between the two has dropped to 800 yuan / ton, much lower than the end of last year’s 3500 yuan / ton.

From the perspective of the smelter, scrap copper and refined copper in a reasonable spread of 1,500 yuan / ton, so all the waste copper smelting state. At present, scrap copper smelting enterprises procurement of coarse copper smelting, due to coarse copper processing fee of 1,300 yuan / ton, while the smelting cost of 1,100 yuan / ton, smelters exist 200 yuan / ton profit. However, the current coarse copper processing fee compared with the fourth quarter of last year, 300 yuan / ton decline, indicating that the continued supply of coarse copper situation is weakening.

From the processing enterprises to see, scrap copper rod sales are good, but high quality scrap raw materials less than normal. The reason is: First, refined copper and scrap copper spreads larger, scrap copper processing enterprises to buy goods, so that the market supply reduction; Second, short-term copper prices fell, while foreign scrap copper offer strong, scrap copper imports continued losses, imports Atrophy.

Terminal demand is good, the stock firm

Into May, copper spot in a slight premium state, downstream companies are still bargain hunting. Research results show that a substantial increase in copper pipe business purchases, and household appliances production and sales growth is closely related. National grid in April tender volume higher than the same period last year, cloth and other good demand for wire and cable, cable and cable enterprises overall operating rate picked up, some small and medium enterprises to expand the scale of production.

Shanghai copper callback is the opportunity to buy

Based on the above research, we believe that copper industry performance is good, copper prices continue to adjust down the space is not. At the same time, from a technical point of view, Shanghai copper 44,000 yuan / ton near the strong support. We believe that the downward adjustment of copper prices is buying opportunities.

With the main aniline production plant back to normal operation, aniline market supply increased. However, due to the “zone along the way” Summit opened on the 14th, in some areas hazardous chemicals line, and part of the polluting enterprises down or parking, aniline demand reduction. Supply and demand side of the balance began to favor the buyer. And the odds of pure, benzene prices began to fall from the 5th, aniline cost side of the pressure again. After adhering to the three days, 9, aniline prices finally entered the downstream channel.

This phase of the decline in the price of aniline, from the supply and demand side and the cost of a double blow. Due to the complexity of the factors affecting the price of benzene, so the majority of aniline business hope that the supply and demand of aniline boost. According to Zhuo record, the recent maintenance of the domestic MDI factory focus: Shanghai Lianheng 5 near the parking maintenance, is expected to last 21 days; Wanhua plans to repair in late May … … and rubber additives, antioxidants, dyes and other downstream in the long Environmental protection, the device load has been running in the low. The recent performance of cyclohexylamine is still limited, but limited by its downstream in the aniline in the relatively small, weak demand for aniline support.

The domestic demand for aniline is not optimistic, some businesses will look to the export market, then, small tape with you to analyze the export situation of aniline, to explore the current stage of relying on the export of aniline can save the market.

First, let’s look at the distribution of the 2016 aniline-exporting countries. China’s total exports of aniline in 2016 in 10.37 million tons, an increase of 19.96 million tons of aniline exports in 2015 compared with an increase of 04,100 tons. As can be seen from Figure 2, aniline exports, India ranked first, exports to India, the total amount of aniline in 43,200 tons, accounting for 42%. Followed by exports to Hungary, the total amount of 40,900 tons, accounting for 39%. This part of the Wanhua dispatch to the Hungarian MDI factory production of raw materials, so this is not as a commodity analysis. In addition, 10% of the export volume to the South Korean region, the number of 10,200 tons. US exports in the number of 0.60 million tons, 0.23 million tons in Taiwan.

It can be seen that the main exporting countries for the quantity of aniline are India, South Korea and the United States. China’s major exporters are WOCHEM and LUBON INDUSTRY CO.LTD, the other is the export of Shandong region traders also have a certain amount of exports each year. Among them, WOCHEM mainly exported to South Korea, for the amount of long. LUBON is mainly exported to India, also exported to the United States, but its poor stability.

It is understood that the end of May there are still some export orders, the majority of factory exports and about. Because the current domestic price of aniline higher, traders speculative exports almost stagnant. But with the domestic prices lower, there may be no trade window open. However, it is worth noting that in mid to late June, India will enter the rainy season, pesticides, dyes and other downstream industries into the off-season, aniline demand will be significantly reduced. Therefore, whether the trade surplus can be opened in time, is the most critical issue.

It is certain that, after late May, the existing export orders are basically completed, relying solely on a small amount of goods sent to South Korea and the United States, it will be difficult to supply and demand of aniline to form a strong support.

Domestic butanol market in a wave after the slide, the international crude oil market is weak shocks, should be weak butanol market has emerged a turning point.

Propylene

From mid-March to the end of April has been in a slump. But due to the recent Asian 200,000 tons of propylene plant overhaul, the domestic propylene market began a new round of warmer.

Coupled with Hebei Haiwei PDH device parking maintenance, Shandong manufacturers inventory declining, the price rebounded quickly, the market mentality also will improve. Shandong to practice atmospheric decompression rate of 56.56%, due to the recent environmental pressure, operating rate is still limited in the short term. Although the current international crude oil market weakness, but the short term propylene market by the impact of the stock will continue to be strong.

N-butanol

From the beginning of March 28 domestic butanol began to decline, while the week most of the n-butanol plant load maintained at about 7 percent, and some of the device parking. Market inventory has experienced more than 1 month of consumption, has been low. May started limited, the market inventory low, short-term market may rise slightly larger.

Device

In addition, Lubon Indusry Co., Ltd May 4, n-butanol plant annual capacity of 85,000 tons, parking maintenance, is expected to repair about 15 days.

According to statistics, April 28, 2017 domestic butanol factory operating rate of 73.64%, only 7 days on May 5, n-butanol manufacturers operating rate fell to 67.70%. It is expected that with the “one way along the” impact of environmental pressure under the operating rate of the manufacturers will be reduced.

May started limited, the market inventory low, the main raw material propylene market stability support, short-term market may rise slightly larger.

In April 2017, the China Manufacturing Purchasing Managers’ Index (PMI) was 51.2%, down 0.6 percentage points from the previous month and continued in the expansion range.

According to the scale of enterprises, the PMI of large enterprises was 52.0%, which was 1.3 percentage points lower than that of last month and remained in the expansion range. The PMI of medium-sized enterprises was 50.2%, 0.2 percentage points lower than that of the previous month. The PMI of small enterprises was 50.0% Month rise, higher than last month 1.4 percentage points, rose to the critical point for the past two years high, business situation has improved.

From the classification index, the production index, the new order index and the supplier delivery time index are higher than the critical point in the five classification indices constituting the manufacturing PMI, and the raw material inventory index and the employee index are lower than the critical point.

The production index was 53.8%, down 0.4 percentage points from the previous month, still in the expansion range, indicating that manufacturing production continued to grow, but the increase narrowed.

The new order index was 52.3%, down from 1.0 percentage point last month, above the critical point, indicating that the manufacturing market demand continued to expand the trend, growth has slowed.

Employers index was 49.2%, down 0.8 percentage points from the previous month, down to below the critical point, indicating that manufacturing enterprises have reduced the amount of labor.

Raw material inventory index was 48.3%, unchanged from last month, continue below the critical point, indicating that the main raw material inventories continue to decline.

Vendor delivery time index of 50.5%, up 0.2 percentage points from the previous month, higher than the critical point, indicating that the manufacturing raw material suppliers delivery time continues to accelerate.