About 81% of 101 professional investors surveyed by derivatives trading platform CloseCross believe commodities are entering a supercycle (where commodities trade at higher prices than they have in the long term, driven by strong demand and lagging supply) period of price trend). There was a commodities supercycle at the beginning of this century, and some analysts predict that the impact of the COVID-19 pandemic and the energy transition will trigger another supercycle. The survey found that 80% of respondents believed government spending would drive a supercycle, while 77% said the green energy transition would play a role.
After several days of difficult negotiations, OPEC+ still failed to reach an agreement on increasing production. OPEC+ representatives said on Monday that they had not set a date for their next meeting. This means that OPEC+ will continue to maintain current production levels and will not increase production. Affected by this, international oil prices rose collectively. The U.S. oil August contract rose 1.6% to US$76.36/barrel, a new closing high since November 2014; the September contract of Brent oil rose 1.14% to US$77.04/barrel, a record high since October 2018. A new high since the beginning of the month.
Most domestic futures closed higher in night trading, with black stocks leading the gains. Iron ore rose by 3.47%, thermal coal rose by 2.9%, coke rose by 2.61%, coking coal rose by 2.33%, hot-rolled coil rose by 2.14%, and rebar rose by 1.77%.
Fundamentals and cost support jointly push up the polyester sector
This Monday, driven by costs and fundamental supply and demand, the prices of polyester varieties were relatively strong. Among them, the main price of PTA rose by more than 3% during the session. EG and staple fiber both hit new stage highs and closed up 2.49% and 2.62% respectively.
“From a cost perspective, international oil prices have remained strong recently. Although the market still speculates on OPEC’s future supply adjustments, in the short term, considering the arrival of the summer travel season, it is expected that Refined oil consumption will support oil prices.” Li Wanying, a senior energy and chemical analyst at Donghai Research Institute, told a reporter from Futures Daily that from the perspective of supply recovery, through the assessment of the recovery of U.S. shale oil production, it will take at least a while to achieve a full production recovery. to the third quarter. Therefore, in the short term, cost support for the polyester sector still exists.
In terms of PTA, according to Li Wanying, a 2.5 million-ton PTA unit in East China was shut down last weekend and is expected to be inspected for 1-2 weeks. As of last Friday, the PTA load was adjusted to 79.2%. With the mainstream supply reduction, the TA basis is relatively strong, and the spot price is temporarily tight. From the perspective of the supply and demand balance sheet, TA will be in a relatively tight balance state in the next month. In terms of valuation, TA spot processing fees have been relatively high recently, but short-term downward pressure is limited.
As for EG, she said that EG port inventory has accumulated slightly recently, but because of its low production profits, the current price is not significantly overvalued. The polyester end has controlled inventory at a reasonable level after experiencing price reduction promotions. In terms of short fiber, due to the rapid rise in raw material prices and low profits, it is expected that the price of the sector will continue to oscillate in the short term. Taken together, the contradiction between supply and demand in the entire polyester sector has shifted, and investors are advised to continue to pay attention to the recovery of terminal production and sales.
Steel plants have resumed production one after another, promoting the short-term strength of black series
On Monday, coking coal and coke opened at a high level, with strong oscillations. Tu Weihua, a black researcher at Baocheng Futures, said that steel plants that were suspended during the celebrations have resumed production one after another, and the demand for raw materials has ushered in a short-term improvement, which in turn drove the double burner and iron ore futures prices to strengthen significantly.
According to Tu Weihua, at this stage, the fundamentals of coking coal are still good, and the production capacity of coal mines that have been suspended in the early stage is relatively large. Statistics from the Iron and Steel Federation show that a total of 128 coal mines have been suspended in Shanxi, involving a suspended production capacity of 185.55 million tons, and most of them are concentrated in high-quality main coke, fat coal and other skeleton coal types. In addition, the time for the resumption of coal mine production is uncertain. It is optimistically expected that it will gradually resume in mid-to-late July. During the recovery period, coal washing plants, independent coking plants, and steel plants’ own coking plants will also face replenishment. It is expected that it will take 2-3 months to fully restore supply. .
“It can be seen that there is a time lag between the resumption of production of domestic coal mines and the release of output, and the benefits of limited supply still exist. At the same time, even if the supply of domestic mines is restored, foreign coal such as Mongolia Coal cannot Supplementing the background of Australia’s coal reduction, the tight supply of coking coal is still difficult to alleviate.” He said that at the same time, coking companies are actively producing due to high coking profits, coking coal in all links of the industrial chain continues to be destocked, and short-term demand is supported. And as new coking capacity comes on stream, medium-term demand is equally optimistic.
“Correspondingly, as coking coal prices stabilize, the risk of downward costs weakens, which in turn drives coke futures prices to strengthen. However, because its fundamentals are still weak, coke oven production will be suspended during the celebrations. Production will be resumed one after another, and coke companies are active in production under high profits, and subsequent output will gradually increase. In addition, the launch of new production capacity will bring mid-term supply increase, and supply pressure will easily bear the pressure on coke prices.” Tu Weihua mentioned that the relative advantage is that steel mills After the suspension of production is over, demand will gradually recover, but steel mills’ profits are low and coke inventories have rebounded, so demand growth is hard to be optimistic about. In addition, due to the significant difference in coke steel profits, steel mills’ willingness to lower prices still exists, which also puts pressure on coke prices. At present, he believes that as the risk of downward costs weakens and demand recovers in the short term, coke futures prices will strengthen, but its fundamentals are still weak. The sustainability of the upward price drive remains to be seen, and he is cautiously bullish on operations.
For iron ore, Lu Hongxiang, a black analyst at Zheshang Futures, said that the domestic mine accident in June led to short-term restrictions on the supply of domestic ore, which provided strong support for iron ore prices. . July 1st��Many ministries and commissions across the country have shown concern about commodity prices, and combined with the impact of blast furnace furnaces and port closures, the average daily port discharge and molten iron production have declined significantly, and furnace charges have also fallen significantly. However, after July 1st, the early speculation about the production restriction of steel plants became a bullish factor. Recently, many steel plants in Tangshan and Shanxi have resumed production one after another. The market expects that the demand for steel for iron ore will still be strong.
Based on fundamental data, the total iron ore shipments from Australia and Brazil in this period were 27.723 million tons, an increase of 3.541 million tons from the previous month; of which Australia shipped 15.603 million tons to China , a month-on-month increase of 805,000 tons, and Australia-Pakistan shipments have always been relatively stable. The latest imported iron ore inventory in the country’s 45 ports was 122.3486 million tons, an increase of 589,500 tons from the previous month. The average daily port discharge volume was 2.5828 million tons, a decrease of 367,000 tons from the previous month. The inventory of 64 steel mills is 15.5305 million tons.
“Although steel mill inventories continue to hit new lows during the new year, port inventories have accumulated slightly and the absolute inventory is higher than the same period in 2019 and 2020. At present, the later restrictions The production policy is still unclear, and the demand for iron ore is still likely to weaken in the later period. The market outlook still needs to pay attention to the implementation of crude steel production reduction.” Lu Hongxiang believes that in the context of peak carbon emissions, it is not recommended to pursue higher prices for iron ore. What will happen in the future? The recovery of steel production is less than expected, so we can operate with a bearish approach. </p
