Glass demand analysis
As of mid-June 2023, the order days of deep processing enterprises were 15.3 days, 0.4 days less than previous period, and the ring ratio was -2.55%. The performance of deep processing in North China is general, the orders of processing plants are still insufficient, and the mentality of purchasing original films is cautious. The downstream of East China just needs to purchase, the volume of scattered orders has not improved, and the intermediate trade is cautious in hoarding. At present, the price is too high to meet the expectation of hoarding, and the price of coated products has dropped by 1-2 yuan/heavy box. This week, the performance of deep processing orders in the central China market is still weak. Without the stimulation of favorable factors, the middle and lower reaches of the market operate rationally and only maintain rigid demand for goods. They are not optimistic about the future market. Downstream deep processing enterprises in South China region generally receive orders as a whole, the price of the original film is declining, downstream procurement is more rational, and rigid demand is the main factor. The fluctuation of deep processing enterprises in southwest China is not big, the order situation is general, there is no significant increase, the transaction has a downward trend, and the original film just needs to be purchased. Northeast downstream is in the construction period, just need to purchase, the follow-up order quantity has not improved, and the project order quantity is insufficient. Traders' willingness to hoard goods is not strong, and most of them hold a wait-and-see attitude.
Soda ash industry analysis
This week (June 23-June 29, 2023), the price of industrial chain products is weak. During the week, the market price of steam coal was reduced to 820 yuan/ton; the mainstream market price of light soda ash in East China was 2000 yuan/ton, and the mainstream market price of heavy soda ash was 2150 yuan/ton. The average price of domestic float glass market dropped to 1901 yuan/ton, with a ring ratio of -2.76%. As of June 29, 2023, the theoretical profit (double ton) of soda ash produced by combined soda process in China was 722.60 yuan/ton, with a month-on-month ratio of -25.50 yuan/ton, a decrease of 3.41%. During the week, the coal price fluctuated and adjusted, the price of ammonium chloride moved down slightly, and the price of soda ash was weak and stable, so the profit was slightly reduced.
This week, the domestic soda ash price trend stabilized, the spot price fluctuated slightly, and the overall performance was strong. There is a game on the supply side of soda ash, the demand is wait-and-see, and the price of soda ash plants remains strong, but the downstream is affected by the release of new devices in the later period, and the mentality is more cautious, mostly just needed and a small amount of purchases. At present, the order of the soda plant is stable and declining for nearly 15 days; the total inventory of soda ash enterprises is 437300 tons, an increase of 2.53% on a month-on-month basis, but the demand for light alkali increases, the inventory of light alkali shows a downward trend, and the increase is mainly due to heavy alkali. Recently, the soda ash plant has only a small fluctuation. Chongqing Heyou was overhauled
last weekend and has resumed production. The rest of the equipment is running steadily, with a weekly output of 610,300 tons. The news of yuanxing new plant feeding is constantly fermenting, and under this influence, the market mentality is cautious. The overall operating rate of soda ash in the week was 90.30%, 91.34% last week, and the ring ratio was -1.04 percentage points. Among them, the operating rate of ammonia alkali was 91.55%, with a ring ratio of -1.34 percentage points, and the operating rate of co-production was 88.72%, with a ring ratio of -0.88 percentage points. The overall operating rate of 12 enterprises with an annual production capacity of one million tons or more was 92.36%, with a ring ratio of -0.05 percentage points. The output of soda ash was 603,400 tons, a month-on-month decrease of -7,000 tons or 1.14%. The output of light alkali was 295,500 tons, with a month-on-month ratio of + 1,600 tons. The output of heavy alkali was 307,900 tons, a month-on-month ratio of 8,500 tons. From the supply side, the recent enterprise maintenance enterprises are few, and the plant operation is stable. It is expected that the overall start-up will fluctuate slightly next week. It is estimated that the start-up will be about 91-92% next week, and the output will be 61-62 thousand tons. By the end of
June, Xuzhou Fengcheng and Shandong Haihua have maintenance plans, and the rest of the production lines are mostly concentrated in July-August. Before the end of the month, spot prices fluctuated slightly and were relatively strong. On the demand side, the demand for soda ash is relatively stable, and most of the downstream enterprises just need to replenish. The operation of float glass is stable, but the early ignition production line is facing the production of products; a photovoltaic glass production line of 1200 tons/day is expected to be ignited. On the whole, supply and demand are relatively maintained, and it is expected that the short-term trend of soda ash will be volatile and stable. This week, the total inventory of domestic soda ash manufacturers was 428,500 tons, down 2.01% from the previous month's-8,800 tons. Among them, 174,400 tons of light soda ash, ring ratio + 23,800 tons, heavy alkali 254,100 tons, ring ratio-32,600 tons. As of June 29, 2023, the shipment volume of China's soda ash enterprises was 624,500 tons, which was + 41,600 tons compared with the previous week; the overall shipment rate of soda ash was 101.43%, which was + 3.26 percentage points compared with the previous week.
On the whole, although the current production and consumption of soda ash are still in a tight balance, the market lacks driving factors, so it is difficult to have a trend in the market, and the whole market is treated with a wide range of shocks. After the middle and last ten days of June, seasonal maintenance may lead to a decline in supply. At that time, it is not excluded that the market supply will be further tight, and the futures price center is expected to move up. However, we need to be alert to the time and rhythm of yuanxing's products to make up for the lack of supply. The current market game point is the possible short-term shortage of spot and the speed of yuanxing Energy's products. Recently, the trial production of the first line of Phase I of Alashan Soda Ash Project of yuanxing Energy has been successful. It is expected that the first line will reach the production capacity in July, and the rest of the subsequent production lines will be commissioned one by one. Under the pressure of long-term new production capacity, the excess supply of soda ash is a big probability event, and the price still has downward space in the long run. The future market is a race between the possible short-term shortage of spot products and the speed of yuanxing Energy's products. Pay attention to the situation of yuanxing's products. SA 2309 has a shock range of 1500-1800, which is matched with high bias.
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