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Core data and viewpoints

Supply and demand

Upstream PVC starts:

As of the week of April 25, the upstream start-up load rebounded slightly. This week, the overall start-up load rate of PVC powder was 74.36%, with a month-on-month ratio of + 3.02%. Next week (4.25-5.2), the upstream operating rate is expected to continue to rise to about 78-79%. Due to the gradual restart of maintenance devices, the number of new maintenance devices is small at the end of April and the beginning of May.

Production plan:

In 2023, Xinfa 40, Huayi 40 and Wanhua 40 were put into production, Julong 40W negative, Zhonggu 300000 restarted in early November 2023, with a total of nearly 1.9 million put into production or restart. The production capacity of 2.2 million tons may be put into production in the whole year from 2024 to 2025, of which Zhenyang 30W, Jintai (planned 60W) 300000 and Bay 20W are more determined. It is understood that Jintai 300000 will be put into production in May. Zhenyang has already test-run qualified products in the first quarter.

The plastic Federation investigates the demand in the lower reaches of South China:

During the week of 4.13-4.19, with the end of the traditional holiday in Guangxi, the starting load in the lower reaches of South China rebounded obviously. In the current period, the load in the lower reaches of South China is 49.48%, with a month-on-month ratio of + 3.95%, which is-6.17% compared with the same period last year. At present, the construction of film material and foaming board in South China is better than that in the same period in previous years, while the profile is slightly better than in the same period in previous years.

Warehousing logistics

Social inventory dropped slightly this week, while the upstream decline was more obvious, showing as follows: upstream decline, East China slight increase, South China decline, Southwest flat. Southwest China is mainly due to the recent relatively cheap car shipments, part of the railway operation did not enter the warehouse, resulting in a decline in inventory in some areas. South China shipping is not as good as last year mainly because the supply of goods from Wanhua and Huayi complements the South China market, and the upstream of the northwest reduces shipments to the consumption areas of South China (the following East and South China data are taken from Zhuochuang).

Inventory (South China + East China + Southwest) is estimated to be 576300 tons, month-on-month-3000 tons, year-on-year 98500 tons.

Inventory (South China + East China + Southwest + upstream) is estimated to be 956500 tons, month-on-month-25200 tons, year-on-year 60200 tons.

Import and export

Import is semi-closed, profit is-1071; export theory is closed, profit is-2 copyright 42 (calculated according to upstream ex-factory price 5300, export income is compared with export cost northwest ex-factory price + freight to Tianjin port). The bidding price of calcium carbide method is mostly or lower around FOB700, Tianjin Port calcium carbide method estimates FOB700, link ratio-5, export income 5618, after deducting export miscellaneous fees and freight charges, Inner Mongolia factory 5258 export has an advantage, the current Inner Mongolia factory price is expected to be around 5300 to 5350, the export is temporarily closed. However, considering the overall production profit, some upstream will choose exports to reduce the pressure on domestic sales.

The month-on-month decline in the number of new exports shrank in the week of April 19, at a low level (17000 in the past year and 19000 in the past two years).

International sea freight rates continue to rise by a large margin. Tianjin Port to Vietnam Ho Chi Minh 1000, Coastal Defence 700,850, Mondra 16002200, Nawasheva 16002200. The freight rate of FOB700+ exported from China to India by calcium carbide method is 68,000 768, although it has an advantage over the mainstream international quotation CFR800, but because of the increase in freight costs, the price of FOB is more serious (Formosa Plastics offers in May-30pm FOB India 800th).

India implemented the BIS policy on September 1st, taking into account the future ship, plus the uncertainty of the June-September monsoon season and the BIS policy after September, it is expected that local imports will increase their purchases around May. India, March 26, 2024: the authorities want to verify whether China has dumping problems during the period from October 1, 2022 to September 30, 2023.

Valuation

Chlor-alkali valuation:

Medium, liquid alkali stable sheet alkali rebound, power coal rebound, blue carbon stable medium rise, calcium carbide stable, calcium carbide marginal device profit:-48

Purchased calcium carbide PVC cost (sharing 0.47 electrolysis cost): Shandong 6411; Inner Mongolia 5314; purchased calcium carbide PVC profit: Shandong-911; Inner Mongolia 36

Calcium carbide profit:-244 electricity 35 (calcium carbide down, blue carbon stable)

Comprehensive profit of Shandong marginal plant: (0.75alkali + 1PVC)-48,0.88liquid chlorine + alkali): 329liquid chlorine)

North China marginal plant comprehensive profit (purchased calcium carbide):-78 (PVC+0.75 sheet alkali, but the actual industrial chain is long, generally there is no loss as a whole)

Comprehensive profit of Northwest marginal equipment (non-Inner Mongolia calcium carbide + purchased electricity): 78 (PVC+0.75), caustic soda fell

(23.11.17 week adjustment profit formula, comprehensive profit from 0.7 caustic soda to 0.75 caustic soda)

Northwest Ningxia PVC folding surface safety margin: 5300 (static estimation based on current caustic soda and calcium carbide)

Referenc

Price

Reference price:

The origin of Mongolian coal is 5500 Flux 605 minutes 10; Orchid charcoal: 897 minutes 52

Shandong caustic soda 32% 760 (discount 2375, + 2 (discount 6.25)

Inner Mongolia tablet alkaloid: 2950

Liquid chlorine Shandong: 300,000,127

Calcium carbide Shandong: 313050 Mill 50; calcium carbide Inner Mongolia: 2550MAIL 50

Main

Logic

It is rumored that the first-tier cities have relaxed their purchase restrictions, and the news market of bond purchases by the central bank in the secondary market is interpreted as domestic QE.

Summary

1. The inventory contradiction is still prominent. The absolute value of inventory is high, and the speed of going to the warehouse is slow. Although the maintenance efforts are significant in mid-late April, the inflection point of social inventory does not appear obviously. The intensity of maintenance will decline in the next two weeks, and the upstream start-up materials will rise to 78-79%.

2. The export supports the bottom but there is no obvious drive. India pulse delivery, domestic PVC exports are still expected to maintain a good level to play a role in regulating domestic supply. India implemented the BIS policy on September 1st, and India has no obvious new capacity in 2024. It is expected that India's external dependence on PVC in the next two years is higher, but it is expected that there will be an outbreak of growth in 2022 and 2023. Taking into account the future ship, coupled with the uncertainty of the June-September monsoon season and the post-September BIS policy, India is expected to increase purchases in advance around May, and domestic exports are expected to maintain a good level in the first half of the year. Indian authorities want to check whether China has dumping problems during the period from October 1, 2022 to September 30, 2023.

However, from the perspective of the global supply pattern, it has little impact on domestic exports, but may lead to a sharp increase in export orders in a certain period of time.

3. Calcium carbide based on PVC maintenance season and its own high start, the price is still weak, but coal blue carbon rebounded. Coal chemical industry is supported by cost and sentiment, blue carbon rebounds, calcium carbide continues to have limited downward space.

At present, the inflection point of social inventory is not obvious, and the downstream construction is weaker than the same period last year, but the scope is narrowed. The weekly peak of maintenance appeared, Jintai 300000 material was put into production in May, the rainstorm in the southern flood season continued, it is expected that the downstream demand can hardly be greatly improved, and the margin of supply and demand may be further weakened. PVC futures price is not obviously strongly driven, is expected to fluctuate in a narrow range with macro market sentiment, temporarily looking at 5850-6000 range shocks.

Highlight

Attention

1. The uncertainty of the situation in the Middle East increases, pay attention to the trend of crude oil; 2. Spring inspection; 3. Commodity sentiment