The probability of PVC resin market warming is too high

Since May, the price of PVC has fluctuated due to the macro impact. Against the backdrop of high US inflation expectations, commodities collectively experienced a wave of decline in early May. Among them, PVC gradually stabilized and rebounded after the sharp decline. The price of calcium carbide method was around 8750 yuan / ton, and there was an obvious willingness to receive goods in the downstream. At present, the operating load of PVC has increased slightly, and the demand side focuses on the resumption of work and production in the Yangtze River Delta. In addition, the mood of the downstream was suspended after replenishing the stock at a low price, and there was no continuous performance of rigid demand. Follow up attention was paid to the recovery of demand.

The operating load increased slightly

As of the week of May 15, the operating load of PVC production enterprises was 82.43%, with a month on month increase of 0.26%, and the contribution of some maintenance devices in the early stage was increased. Among them, the starting load of calcium carbide PVC was 83.83%, with a month on month increase of 0.72%; The operating load of Vinyl PVC was 77.26%, down 1.43% month on month. Overall, the overall operating load of the domestic PVC industry increased slightly.

In addition, from the perspective of this year's dual control policy on energy consumption, the policy will still make corresponding norms and restrictions on calcium carbide and other high energy consuming industries. However, from last year's experience, this year will not adopt the "one size fits all" correction, and the stable and rational promotion policy will have certain restrictions on calcium carbide production. In addition, may is the regular maintenance period of the PVC industry. Dezhou Shihua, Sichuan Jinlu, Shaanxi Beiyuan and other devices have relatively definite maintenance plans. However, the maintenance of some devices is delayed due to the impact of the epidemic this year. If it can be carried out as scheduled, it will have a certain support for the PVC market.

Theoretical export profit thickening

Since the Federal Reserve announced a 50 basis point increase in interest rates, the US dollar has hit a 20-year high, which has led to varying degrees of depreciation of the euro, RMB and yen. Foreign media said that in order to fight inflation, multinational central banks led by the United States are seeking to appreciate their currencies and help reduce inflation by reducing the price of foreign products. Under this influence, non US dollar currencies basically depreciated to a certain extent.

The latest external quotation shows that the PVC market price in Asia has decreased slightly, CFR China reported US $1300 / ton, CFR Southeast Asia remained stable at US $1395 / ton and CFR India reported US $1520 / ton. With the sea freight basically unchanged, as of May 13, the spot exchange rate of the US dollar against the onshore RMB was reported as 6.7863 yuan, the theoretical export profit increased slightly, the profit in Southeast Asia increased by 131 yuan / ton month on month, and the profit in India increased by 88 yuan / ton month on month. However, the actual transaction price of domestic export is not high. The mainstream quotation of FOB Tianjin port is 1180-1210 US dollars / ton, and the actual profit is 0-250 yuan / ton. The pre-sale quotation of Formosa Plastics in Taiwan, China in June is expected to be announced this week, and the market is expected to decline by 50-100 US dollars / ton.

In the future, the PVC flooring market is the main processing accessory to open the export space at home and abroad, and the penetration rate has accelerated in the world through the substitution of other materials. At present, China is the main exporter of PVC flooring, domestic products are mainly exported, and PVC production enterprises have strong international competitiveness.

Order days increase gradually

Recently, the operating load of downstream sample enterprises was 57%, with a month on month decrease of 1.06% and a year-on-year decrease of 5.54%. Among them, the construction of soft products was less than 56%, with a month on month decrease of 2.71% and a year-on-year decrease of 13.43%; The start-up of hard products was 57%, with a month on month decrease of 0.31% and a year-on-year decrease of 2.06%. On the whole, hard products are better than soft products. At the same time, although the start-up in the downstream of each region has weakened slightly month on month, the year-on-year gap between North and South China has narrowed, and the year-on-year gap in East China still exists. In the early stage, when the PVC East China SG5 fell to 8650 yuan / ton, there was a centralized replenishment in the downstream, and the overall order days were at the level of 18.7 days, an increase of 0.62 days month on month. The number of orders increased slightly, and the market ushered in an inflection point. In the later stage, we should continue to observe the strength of demand recovery.

Based on the above analysis, the recent macro environment has become the main factor affecting the trend of PVC. At the beginning of May, the overall operating rate of PVC maintained a downward trend month on month, and paid attention to the release of some speculative demand under the current price. In the follow-up, we should continue to pay attention to the export price and whether the potential increment can be realized. At present, the basis difference between the 2209 PVC futures contract and the mainstream quotation in East China is stable at 150 yuan / ton. Although the demand side orders have increased slightly, the impact of the epidemic and transportation on the market still exists. The author expects that the long speculative demand for PVC and the point price game may guide the market balance. With the opening of the inflection point of resumption of work in the Yangtze River Delta, the demand for PVC will be gradually fulfilled, and the probability of market warming is high.