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[Industry Focus]：Chemical downstream replenishment cycle opens, the second half of the year can start the "peak season market"

Read： 385 Time：17months ago Source：方正化工、期货日报

Although the chemical industry is currently in the industry consumption off-season, but the industry agencies pointed out that, at present, the fundamentals of the basic chemical industry have been in the bottom range, if the second half of the demand continues to repair, then good chemical prices, spreads improve.

After the continuous decline in the second quarter, the price of chemical products has reached a phased bottom, and the inventory of all links has remained at a relatively low level. This situation has prompted companies to increase their willingness to make up for bargains before the peak season, laying the foundation for a rebound in chemical prices.

As of July 14, the CCPI index was at 4406 points, up 2.8 percent from the previous week and 3.3 percent from the previous month.

Founder Securities pointed out that the year-on-year data of chemical PPI in June was at the historical percentile of 31.9 in the past 10 years. In July, the CPPI index showed an upward positive inflection point.

The rebound in raw material prices and the market's expectations for the peak season are the fuse for downstream companies to increase stock. What shows is that the market mentality is changing from not optimistic in the second quarter to optimistic, and there are certain expectations for consumption in the second half of the year. From this point of view, the market is more in the second half of the trading consumption rebound expectations, because this expectation is currently difficult to prove false, so macro bullish funds are active.

The current chemical downstream replenishment cycle is open, downstream active replenishment inventory. As of July 7, there were 31 products with increased factory inventory, accounting for 60%; there were 20 products with reduced factory inventory, accounting for 38%, and 1 product with flat factory inventory, accounting for 2%.

Since July, the energy market has stopped falling and rebounded, which has stabilized the focus of chemical prices, and terminal enterprises and middlemen have made up for bargains. From the disk point of view, long funds actively enter, chemicals will appear a wave of rapid rebound.

Founder Securities combed the key products of various sub-industries of chemical industry from the main perspective of inventory removal, and screened out the sub-products with relatively high inventory decimation in the last 8 weeks and marginal improvement in product supply and demand, such as urea, yellow phosphorus, acesulfame, acetic acid, pure MDI, polymeric MDI, PTA, soda ash, polyester filament, glyphosate and nylon, in the past 8 weeks, the quantile has decreased by 77pcts, 73pcts, 29pcts, 28pcts, 24pcts, 22pcts, 21pcts, 20pcts, 16pcts, 14pcts, and 7pct, respectively.

At present, all links of the chemical industry chain are making up for a certain amount of storage. Whether there is a new round of momentum for the rebound in the market outlook depends on when crude oil prices stabilize the cost center of gravity, and on the other hand, we must pay attention to the strength of consumption rebound in the second half of the year.

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