Futures:

Figure 1: Trend of 2301 contract of natural rubber futures in September 2022

Main trend: In September, the natural rubber futures generally rose sharply first, then retreated and continued to fluctuate in a small range. On the first day, the main price was 13270 yuan/ton, the highest in the middle of the month was nearly 13500 yuan/ton, and on the 30th, the main price was 13135 yuan/ton, down about 1%.

goods in stock:

Figure 2: Trend of natural rubber spot commodity index since 2022

Commodity index: According to the monitoring of the business community, the natural rubber commodity index on September 29 was 36.67, up 0.03 points from yesterday, down 63.33% from the highest point of 100.00 (2011-09-01) in the cycle, and up 34.42% from the lowest point of 27.28 on April 2, 2020. (Note: Period refers to 2011-09-01 to now)

Figure 3: Trend of mainstream natural rubber prices in September 2022

Commodity market: According to the monitoring of the business agency, the spot market of domestic natural rubber (Standard 1) in the East China market in September showed an upward trend of shock, and the trend was weak due to the callback at the end of the month. The market reported 11810 yuan/ton on the first day and 12310 yuan/ton on the 30th, with a monthly increase of 4.23%; The highest price of this month is 12400 yuan/ton on the 27th, and the lowest price is 11702 yuan/ton on the 7th, with the maximum monthly amplitude of 5.96%. Among them, the first ten days saw a slight downward trend of 0.88%: the mainstream quotation in the East China market was slightly adjusted from 11810 yuan/ton to 11702 yuan/ton, only about 100 yuan/ton; In the middle of the year, it rose 3.64% strongly: East China reported 12150 yuan/ton on the 11th and 12132 yuan/ton on the 20th; In the last ten days, the fluctuation range was 1.57%. On the 21st, East China reported 12120 yuan/ton, and on the 30th, 12310 yuan/ton.

Figure 4: Weekly K Histogram of Natural Rubber Market in 2022

Industrial factors: according to the monitoring of the business community, the supply of natural rubber at home and abroad was strong in September, and the price of glue did not change much. Thailand glue was about 45.5-45.7 Baht/kg, and Hainan glue was about 11000 yuan/ton; The arrival of goods at the port has increased, the spot circulation is smooth, and there are still goods arriving at the port after the festival, the spot inventory has accumulated and the order delay continues to arrive at the port; Although the operating rate of finished products of downstream tire enterprises rose slightly in the month, the new purchase volume did not increase significantly due to weak demand orders and sufficient inventory in the factory, and the purchase demand before the festival was lower than that of the previous “Golden Ninth”; Although there is typhoon in the production area in the month, it lasts for a short time and the rubber price rises and falls rapidly. On the whole, the natural rubber market fluctuates slightly in this month.

Figure 5: Trend Chart of International Crude Oil Mainstream Prices in Recent March 2022

Macro factors: In September, the international crude oil futures continued to plummet by nearly 10%. In the month, the U.S. WTI crude oil futures fell below the $80 threshold, hitting a low point since January 10, and the oil price fell for four consecutive weeks, the longest decline since this year. The market is increasingly worried about the economic downturn, and the oil price has been falling constantly against the background of continued geopolitical deterioration. Since the third quarter, WTI has fallen by more than 20%. According to the analysis, the oil price will still seek a balance between the supply shortage and the demand recession expectation in the future, and the superposition of interest rate increase cycle, geopolitical tension and other factors will make the oil market more volatile. In 2022, the continuation of the U.S. monetary policy will continue to depress oil prices. In the medium and long term, oil prices may still have opportunities. On the one hand, the supply side is favorable, and once demand rebounds, oil prices will continue to rise.

Figure 6: Comparison Chart of Annual Spot Market Trend of Natural Rubber from 2020 to 2022

Future market forecast: considering the recent downstream tire orders and purchase demand status, it is unlikely that natural rubber will rise significantly without major extreme weather impact and downstream demand improvement, and the probability will remain volatile.

Recent domestic sulphuric acid price trend

After five months of continuous decline, the sulfuric acid market finally rose slightly in September. As can be seen from the figure above, the domestic sulfuric acid market price fell first and then rose in September. The market price of sulfuric acid fell from 252.00 yuan/ton on September 1 to 228.00 yuan/ton on September 14, a decrease of 9.52%. Later, it rose to 258.00 yuan/ton on September 29, up 13.16%. The price at the end of the month fell 70.40% year on year.

On September 28, the sulfuric acid commodity index was 40.16, up 1.56 points from yesterday, down 78.65% from the peak of 188.07 (2022-04-13) in the cycle, and up 27.41% from the lowest point of 31.52 on June 6, 2019. (Note: Period refers to 2011-09-01 to now)

The upstream support is better, while the downstream demand is insufficient

Domestic sulphuric acid market in September

From the manufacturer’s quotation, the price of domestic mainstream sulphuric acid manufacturers rose and fell with each other this month, and the manufacturer’s inventory was small.

From the perspective of the upstream and downstream industrial chain, the upstream sulfur market rose sharply this month. The sulfur price rose from 1163.33 yuan/ton at the beginning of the month to 1453.33 yuan/ton at the end of the month, an increase of 24.93%. Compared with the same period last year, it fell 26.23% year on year. The upstream cost support improved, which had a positive impact on the sulfuric acid market. The downstream hydrofluoric acid market declined slightly. The ex factory price fell from 10560.00 yuan/ton at the beginning of the month to 10480.00 yuan/ton at the end of the month, a drop of 0.76%, and a year-on-year drop of 6.18% compared with the same period last year. The downstream titanium dioxide market declined slightly, with the price falling from 17500.00 yuan/ton at the beginning of the month to 16350.00 yuan/ton at the end of the month, a decline of 6.57%, 21.96% YoY compared with the same period last year. Downstream market fell slightly, and downstream manufacturers’ purchasing enthusiasm for sulfuric acid weakened.

The market rose slightly after shocks

In the first ten days of October, the domestic sulfuric acid market rose mainly due to slight fluctuations. The upstream sulfur price rose significantly, the cost support improved, the downstream hydrofluoric acid and titanium dioxide market declined slightly, the downstream purchasing enthusiasm for sulfuric acid was average, and the product trend rose under the contradiction between supply and demand. According to the sulfuric acid analysts of the business community, the short-term sulfuric acid market may rise slightly under the influence of supply and demand, raw materials and other aspects, mainly finishing.

According to the bulk list data of business cooperatives, as of September 28, the average price quoted by epichlorohydrin enterprises was 11266.67 yuan/ton, down 2.03% from September 1, down 39.43% year on year in a three-month cycle, and down 46.60% from the same period last year.

The market price of epichlorohydrin fell slightly in September. In the first half of the month, the price of raw propylene rose, the price of glycerin stayed high, the cost side was supported to some extent, the market supply side was sufficient, but the demand side was weak, and the imbalance between supply and demand dragged down the weak market operation. The downstream prepared goods in an orderly manner before the festival, and returned after the festival. The market was mainly cautious. The enthusiasm of downstream inquiry and procurement was general, the market atmosphere was light, and the transaction was limited. In the second half of the month, the cost support remained, the supply side was sufficient, the downstream price was just in need of replenishment, and the market trading atmosphere was flat. Near the end of the month, the enterprises gave up their profits and lowered their stocks, and the downstream stock preparation was gradually approaching the end. The market trading atmosphere was light, and the market fluctuated in a narrow range.

On September 27, the benchmark price of upstream propylene was 7530.60 yuan/ton, up 6.06% compared with 7100.60 yuan/ton on September 1.

Downstream epoxy resin, on September 28, the liquid epoxy resin market in East China continued to rise last week, and this week it was put into operation. The mainstream negotiation was conducted at 20400-21000 yuan/ton, and the overall negotiation was the same as the last trading day.

According to the epichlorohydrin analysts of the business community, the cost is still supported at present. Manufacturers mainly reduce their stocks before the holidays. Downstream stock preparation is gradually coming to an end, and market transactions are slowing down. It is expected that the epichlorohydrin market will operate weakly and stably in the short term. More attention should be paid to the market news guidance.

According to the data monitoring of the business community, as of September 27, the reference average price of 30% grade phosphorus ore in mainstream areas in China was around 1064 yuan/ton, which was 4 yuan/ton lower than that on September 1 (1068 yuan/ton), a drop of 0.37%. Compared with August 1 (the reference price of phosphate rock is 1100 yuan/ton), the price decreased by 36 yuan/ton, or 3.27%.

It can be seen from the data monitoring chart of the business community that since September (9.1-9.27), the overall performance of the domestic phosphorus ore market has been mainly stable. At the beginning of September, the overall market situation of domestic medium and high-end grade phosphorus ore has slightly declined, and the price of some mining enterprises has decreased by about 10-20 yuan/ton. At the beginning of the month, the main reason for the weakening of the phosphate ore market was that the terminal demand of the downstream phosphate fertilizer market was average, which affected the mentality of the industry. The support for the phosphate ore demand side was loose, and the overall market atmosphere was weaker than that at the end of August.

In the middle and late September, the domestic phosphorus ore market was generally stable and consolidated. The supply in the phosphate rock yard is still tight, with less spot circulation. Some mining enterprises mainly implement early orders, and supply more pre orders. Therefore, the supply side continues to give some support to the phosphate rock market.

As of September 27, the market price of 30% grade phosphorus ore in China is around 1030-1100 yuan/ton, and there is also a gap between the price and the original ore specification, powder to lump ratio and other factors. The details need to be negotiated. The market price of 28% grade phosphate ore is near 850-980 yuan/ton, and the market price of 32% grade phosphate ore is near 1160-1200 yuan/ton. At present, the trading atmosphere in the phosphate rock yard is normal, and the downstream is mainly purchased on demand.

In terms of downstream yellow phosphorus, since September (9.1-9.26), the domestic yellow phosphorus market has risen as a whole. According to the data monitoring of the business community, on September 26, the reference price of yellow phosphorus was 36500 yuan/ton, up 14.45% compared with September 1 (32000 yuan/ton).

Forecast and analysis of phosphate rock future market trend

At present, as the National Day holiday approaches, the logistics and transportation are also stopped. The information in the phosphate rock yard is generally quiet. The phosphate ore data engineer of the business community believes that in the short term, the domestic phosphate ore market will continue to operate mainly in a stable way, and more attention should be paid to the information changes in the supply and demand side.

In September, the trend of domestic propane market was mainly downward. Shandong propane market as a whole showed a “downward slide” trend, and it did not rise by a small margin until the end of the month. According to the data monitoring of the business community, the average price of Shandong propane market was 6015.75 yuan/ton on September 1, and 5703.25 yuan/ton on September 26. The monthly drop was 5.19%, up 0.71% compared with the same period last year.

As of September 26, the mainstream prices of propane in different regions in China are as follows:

Region, September 26

In South China, 5450-5550 yuan/ton

North China, 5650-5800 yuan/ton

Shandong, 5650-5750 yuan/ton

Northeast China, 5700-5800 yuan/ton

In September, the domestic propane market was weak as a whole, and the Shandong propane market decreased significantly by 150-300 yuan/ton. There were obvious negative market factors in the month. In terms of the international market, propane and butane both fell in September when the CP was introduced. In addition, the international crude oil market fluctuated in the first half of the month and fell in the second half. The cost was bad for the market. In terms of supply, Shandong Refinery had sufficient supply in September, but in terms of demand, due to the lack of obvious temperature drop, the increase of terminal demand was relatively limited, and the downstream was cautious, mostly wait-and-see, with poor enthusiasm for entering the market. The manufacturer periodically lowered the quotation to stimulate downstream market entry. At the end of the month (26th), affected by the National Day holiday, Shandong propane market stopped falling and rose due to the replenishment operation in the downstream before the holiday.

Saudi Aramco announced in September 2022 that both propane and butane fell. Propane was 650 dollars/ton, down 20 dollars/ton from the previous month; Butane was 630 dollars/ton, down 30 dollars/ton from last month.

On the whole, the current CP price is expected to fall in October, and the international crude oil price is lowered, which is bad for the market. The terminal demand in September was not improved enough, the downstream was cautious, and the market trading atmosphere was general. Shandong market has abundant supply within a month. There is a demand for warehouse discharge before the National Day holiday. The downstream market starts replenishment before the National Day holiday. The market trading atmosphere has improved. Shandong propane market has seen a slight increase at the end of the month. It is expected that in the short term, the propane market will be dominated by consolidation, and the adjustment range will be limited.

1、 Price trend

According to the monitoring of bulk commodity data, the price of isopropyl alcohol will rise this week. The average price of isopropyl alcohol in China was 7020 yuan/ton last Friday, and 7300 yuan/ton this Friday. The price increased by 3.99% during the week.

2、 Market analysis

Figure: Comparison of price trends of acetone and isopropanol

The domestic isopropanol market price continued to rise this week. The price of raw material acetone continued to rise, isopropanol followed closely, and the price continued to rise. Up to now, most of the isopropanol market quotations in Shandong are around 6900-7300 yuan/ton; Most quotations in Jiangsu isopropanol market are about 7500-7600 yuan/ton. Most factories suspend external quotation. Internationally, on September 20, the US isopropyl alcohol market closed stably, while the European isopropyl alcohol market closed weakly.

In terms of raw material acetone, the price of acetone increased this week. According to the monitoring of bulk commodity data, the average price of acetone last Friday was 5340 yuan/ton, and this Friday was 5540 yuan/ton. The price rose within the week by 3.75%. This week, the main domestic acetone markets showed different gains, most of which continued to rise. The spot supply on the market is still tight, and the holder cannot offer low prices, but he also intends to make profits by actively shipping. The terminal just needs to purchase, and the short-term acetone is expected to be strong.

In terms of raw propylene, according to the monitoring of the business community, as of this Friday, the mainstream quotation of propylene (Shandong) market was 7400-7450 yuan/ton, the market price was stable and the overall market was stable. According to propylene analysts from Chemical Branch of Business Cooperative, after a wave of rebound to maintain stability, the propylene market is expected to rise slightly in the future, boosted by the “gold nine silver ten” in the chemical industry.

3、 Future market forecast

Isopropyl alcohol analyst from Chemical Branch of Business Cooperative believes that at present, the price of raw material acetone has risen, while propylene has temporarily stabilized. Domestic isopropanol on-site cost support is strong. It is expected that the isopropanol market will be strong and upward in the short term. Pay attention to the subsequent raw material market trend.

In the middle of September, the domestic dimethyl ether market was dominated by price shocks, and the Henan market showed a trend of first rising and then falling. According to the data monitoring of the business community, the average price of dimethyl ether in Henan market was 4160 yuan/ton on September 15 and 4200 yuan/ton on September 22, with a rise of 0.96% in the week, down 2.27% compared with the same period last year.

As of September 22, the market prices of dimethyl ether in various regions in China are as follows:

Region, mainstream quotation

Jiangxi, 4300 yuan/ton

Hebei, 4590 yuan/ton

Henan Province, 4090-4200 yuan/ton

This week, the domestic dimethyl ether market was volatile. The ex factory price of Henan dimethyl ether rose first and then fell, with limited positive factors in the market. In terms of cost, the raw material methanol market has experienced ups and downs, bringing phased support to the market. The civil market of liquefied gas related products fell significantly, which was bad for the market. The lower reaches have limited ability to accept high prices, are not enthusiastic about entering the market, and mainly wait and see. The manufacturer lacked the impetus to continue rising, and most prices in Henan market fell on the 22nd. Hebei and Jiangxi markets are mainly consolidation, with limited volatility.

On September 20, the domestic methanol market rose sharply and fell back. In the early stage, the methanol price rose significantly. Recently, the rise slowed down, and prices in some regions fell back. The international crude oil price fluctuated at a high level, while the coal price supported at a high level. At present, the main reasons that affect the methanol price are supply and demand. Most of the early maintenance devices have been restarted, but the demand is general, mainly rigid, and there is no sign of increase in the short term. The traders mainly wait and see, and the international external demand is poor. The rise of the methanol market has slowed down, and the market is mainly volatile.

At present, the raw material methanol market is rising again, which brings some support in terms of cost. However, the civil market of liquefied gas fell significantly, affecting the market mentality. The downstream is cautious, has limited enthusiasm for entering the market, and the market trading atmosphere is general. The manufacturer’s shipment is blocked, and most of the factory prices are lowered. It is expected that the dimethyl ether market will not have enough momentum to rise in the short term, or it will be dominated by narrow consolidation.

Business agency data shows that the recent strong spot silver prices, gold stagflation callback, and gradually entered the range of sideways shocks. In late July, the price of precious metals stopped falling and recovered. In late August, the silver price followed the nonferrous metal market and fell deeply. Since September, it has recovered more strongly. Recently, it has also started to show a sideways trend and the upward momentum has weakened.

In the long term, the trend of precious metal prices tends to be the same, with slightly different amplitudes. What is the reason for the slight deviation of the short-term trend in the near future?

CITIC Futures believes that the future economic pressure will still enable precious metals to obtain allocation significance. We should pay attention to the shortage of silver spot against gold, which has weakened the gold silver ratio in the near future regardless of macro pricing. Whether this trend will continue remains to be seen.

Impact of economic data: It is found from the public data that the US economic data is subject to short-term tenacity disturbance, which makes the long-term anti inflation interest rate rise, and precious metals fall sharply this week. Due to the devaluation of the RMB and the expected decline of 100bp on Friday, precious metals have stabilized again. At the same time, despite the recent monetary tightening, the recession expectation has strengthened, and the precious metals still maintain a volatile pattern. This requires attention to two key data: the term structure of inflation and the term structure of real interest rates.

Dr. Zhang Wen, a researcher of CITIC Futures Precious Metals, believes: (1) From the perspective of the inflation term structure in the past three months, the short end is larger than the long end, indicating that the overall inflation control still has a long way to go; (2) From the composition of recent March, July moved down compared with June, but August moved up again, indicating that inflation data in August may not be optimistic at present; (3) From the perspective of the term structure of real interest rate, the short end moved up in August, indicating the expectation of interest rate increase, but the long end fell sharply, indicating that the recession expectation has been strengthened in recent three months.

Dr. Zhang Wen once recommended in the second quarter to focus on the reverse correlation between gold silver ratio and inflation expectations, and achieved good results. However, the latest data in September showed that silver was significantly stronger than gold, and the negative correlation had weakened previously, indicating that silver’s ability to value the macro attributes of gold had weakened.

The London Gold and Silver Association and Comex silver inventory have declined sharply since December last year, which is far lower than the value in the past five years, while Comex silver inventory has also fallen to the pre epidemic position, which may indicate that the impact of macro pricing on the abundance of silver inventory has weakened.

The impact of the Federal Reserve’s interest rate hike: The inflation data has greatly increased the expectation of interest rate hike. The Federal Reserve’s action in September may meet the mainstream expectation of the market. Although the two sides of the risk of interest rate increase were put forward in the speech of the Federal Reserve in the early stage, which led to a brief hesitation in the market’s expectation of interest rate increase, the speech of the Federal Reserve was still dominated by hawkish language focusing on easing inflation. At the same time, the inflation data in August made the possibility of the marginal easing of the Federal Reserve’s interest rate increase fade away. The actions of the Federal Reserve in this interest rate meeting may again meet the mainstream expectations of the market.

According to the data monitoring of the business community, as of September 20, the reference average price of 30% grade phosphorus ore in mainstream areas in China was around 1068 yuan/ton. Compared with September 11, the price was basically flat. Compared with September 1 (the reference price of phosphorus ore was 1065 yuan/ton), the price decreased by 4 yuan/ton, or 0.37%; Compared with August 1 (the reference price of phosphate rock is 1100 yuan/ton), the price decreased by 32 yuan/ton, or 2.91%.

It can be seen from the data monitoring chart of the business community that after the Mid Autumn Festival, the domestic market for medium and high-end grade phosphate ores was mainly stable and consolidated. The market was generally quiet, with little change in information. From the supply side, the supply side is still tight, and the supply side continues to provide high support for the market. From the demand side, the low commencement of downstream phosphate fertilizer has brought some concern to the market. After the festival, the phosphate ore market was light and stable as a whole. As of September 20, the market price of 30% grade phosphorus ore in China is around 1030-1150 yuan/ton, and there is also a gap between the price and the original ore specification, powder to lump ratio and other factors. The details need to be negotiated. The market price of 28% grade phosphate ore is near 850-980 yuan/ton, and the market price of 32% grade phosphate ore is near 1200 yuan/ton. At present, the trading atmosphere in the phosphate rock yard is mild, and the downstream is mainly purchased on demand.

In terms of downstream yellow phosphorus, since September (9.1-9.19), the domestic yellow phosphorus market has been operating steadily as a whole. According to the data monitoring of the business community, the reference price of yellow phosphorus on September 19 was 36625 yuan/ton, up 14.45% compared with September 1 (32000 yuan/ton).

Forecast and analysis of phosphate rock future market trend

The National Day holiday is coming, and the downstream demand is relatively stable. The phosphorus ore data engineer of the business community believes that in the short term, the domestic phosphorus ore market is mainly stable and operates in a balanced way, and the specific trend needs to pay more attention to the changes in the information on the supply and demand side.

Price trend of magnesium metal

Market analysis this week

According to the data monitoring of the business community, as of the 16th, the average price in the domestic market was 24733.33 yuan/ton, down 1.98% from the beginning of the week. This week, the domestic magnesium metal market was weak due to the drag of demand, and the overall decline was not large. Most of the deals were made in the form of rigid demand.

Supply and demand

On the factory side, the factory quotation was firm at the beginning of the week, and the willingness to stabilize the market was strong. In view of the poor transaction, some factories took the initiative to reduce the price for shipment. After the centralized procurement before the festival, the downstream users bought less this week, the export order performance was poor, and the wait-and-see atmosphere in magnesium market was strong.

Raw materials

The price increase notice of raw material semicarbon was issued, and it will be implemented from the 20th day: 2000 yuan/ton for large materials, 1900 yuan/ton for medium materials, 1850 yuan/ton for small materials, and 1300 yuan/ton for semicarbon foam. The mainstream price of ferrosilicon is about 7600-7800 yuan/ton. The Ningxia manufacturer resumed production, and the supply began to recover. The futures market fluctuated. It is difficult for the spot price to fluctuate greatly before the steel plant bidding in October.

Future market forecast

To sum up, with the centralized procurement by downstream users before the festival, the overall market trading atmosphere was cold and the demand could not be followed up, resulting in the weak price performance of magnesium ingots. Considering that the price of ferrosilicon is at a high level, the price of semicarbon is raised, the cost of magnesium ingots remains high, and the magnesium factory has not lowered its quotation significantly, it is expected that the magnesium market will be slightly consolidated in the short term.