When to "balance" the rubber and tire market
When to "balance" the rubber and tire market
In September 2016, the rubber market suddenly reversed, and the price of demand surged up by more than 100 percent, but recently the price has been sharply reversed. In the face of the "double negative" situation in the United States, the opening rate has been higher, and companies increased their prices at the end of last year. Why is this market and how long can the rally last? In march, "the 12th annual meeting of the China rubber" on, senior industry are analyzed in detail, are predicted by those from upstream and downstream, the future price of natural rubber should appear the situation of the parties into the benign operation, relatively stable.
The need for rubber and tyres has soared
Shen jinrong, chairman of zhongce rubber group co LTD, believes there are five reasons for the surge in domestic rubber demand.
First, the improvement of domestic recard market has led to a doubling of the supporting tyre market. Last year, the state authorities carried out a special operation to treat over-limit vehicles, which will be completed from August 18, 2016 to August 31, 2017. This policy intervention has led to a large number of heavy trucks replacing demand. In 2016, domestic heavy card sales increased by 30 percent year-on-year, most of them in the second half of the third quarter. Sales in January were up 122% in January and 152% in February, and the figure is still up to 100% in March. The growth of heavy card sales, the supporting tyre market doubled.
Second, the replacement tire market has been greatly increased. As natural rubber and other commodity prices rise rapidly, the tire companies are raising prices, tire distributors, retailers and users in the "buy or not to buy up" under the normal logic of replenish onr's stock purchase power, this replacement tire market monthly sales growth of at least 20%.
Third, passenger car tire export growth. The United States launched a "double negative" investigation into Chinese car tyres earlier this year, and Chinese tire exports are expected to fall sharply in general. But on the contrary, the situation of China last year came the card passenger tire exports the two periods the climax of the first paragraph from the investigation to the preliminary established, at the beginning of the second paragraph is laid between the end of the period of validity to the final "window period". This two periods due to the low does not involve export margin and the margin, therefore created a "window" for China tire enterprises to export, card passenger tire exports to the United States fell by 8.4% for the whole year, but the card passenger tire exports up by 5.8%.
Fourth, the high price of synthetic rubber caused enterprises to adjust the formula to increase the natural glue dosage. Due to the shortage of the important raw material of synthetic rubber, the high price of synthetic rubber and the price of natural rubber, the tire and non-tire rubber products enterprises have adjusted the formula to increase the natural rubber dosage. This phenomenon is more common in non-tire rubber products and is more likely to be replaced.
Fifth, the sharing of bicycles nationwide, bicycle tires "multiply". The amazing expansion of the bicycle industry has led to a full recovery in the bicycle industry, with demand for bicycle tyres rising beyond imagination.
Shen Jinrong analysis, in about half a year's time, the above five factors to bring China's natural rubber market respectively 50000 tons, 200000 tons, 30000 tons, 200000 tons and the scale of thousands of tons of increment, since September, China's consumption of natural rubber total increment is expected to more than 600000 tons.
China is the world's largest consumer of natural rubber, accounting for 38.5% of the total, said li shiqiang, general manager of shidong rubber co., LTD. China's natural gum consumption exceeded expectations in 2016, with a conservative estimate of 5 million tons, up 7 percent, and domestic stockpiles being significantly digested. In addition, the demand for latex products is also strong, mainly in the home aspect, should have 100,000 tons of demand increment.
Mr Shen said that China's demand had suddenly increased and that the supply of natural gum could meet demand, but it also consumed a large amount of production and social stock. This balance was indirectly maintained by the 200,000 tonnes of reserve glue sold by the government in the early stages of the government auction, and the 120,000 tonnes of reserve glue announced on March 14th will also increase the support for this balance.
Li shiqiang also believes that natural rubber consumption in southeast Asia in 2016 was equally bright. Thailand, Indonesia, Vietnam, such as natural rubber consumption growing rapidly in recent years, the development of its economy and the special geographical position, make the setting to investment in factories, to become the emerging southeast Asia rubber downstream processing industry base.
Rubber and tyre production need to match
According to the China rubber industry association, the total tire output in 2016 was about 610 million, up 7.9 percent. Among them, the total steel tyre is 121 million, up by 10%. Half steel tyre 444 million, growth 9.6%; The slope was 0.45 billion, down by 10%. The meridian rate was 92.6%. In the first half of 2016, the sales revenue of the industry declined greatly, but by September, the sales volume was negative, and the total growth was 4.43%.
Shen jinrong said that in January of this year, the association's total steel tyre production increased by 6.62 percent. "To be sure, this year is the Spring Festival on January 28th, traditionally most enterprises will be three or four days before, during, and after the Spring Festival holiday, so the actual working days in January to reduce about 20%, but still got 6.62% of the growth, calculated daily output of more than 20%. In February, according to incomplete statistics, industry production growth was still more than 20 percent. In march, the market for replacement tyres did not weaken and remained in a hyperactive environment.
In terms of natural rubber imports, China's natural rubber imports still have a 2.39 percent increase in January, although it was reduced by 5 to 6 working days.
Li Shijiang says, 2016 natural rubber planting area in the world is still slightly increased, but the major producer plastic yield of garden there is an obvious decline, the main reason is the shortage of rubber tappers garden maintenance and rubber farmers to glue the under-funded, labor flow to other areas, the situation in the next 10 years will be more and more serious. In addition, as agricultural products, weather anomalies can interfere with production of gum. The severe flooding in Thailand in 2016 affected the time of cutting glue, affecting production at about 300,000 to 350,000 tons, and the weather for 2017 is currently not known.
According to the production statistics of the ANPRC, Thailand produced 418.5 million tons in 2016, which decreased by 6.4%. It is expected to grow by 4.7% in 2017. In 2016, the production of natural rubber in ANPRC member states fell 2.5 percent, and in 2017, it is expected to grow by 4 percent. In 2016, global natural rubber consumption reached 12.65 million tons, up 4.1%. But supply fell by 0.6 per cent to 12.2m tonnes. The global natural glue gap is 450,000 tons.
Rubber and tire prices have risen in price
Since the end of last year, tyre manufacturers have been raising the price of tires, even if the recent price of natural gum has fallen, it still can't stop the adjustment of the tire companies. First, the price of raw materials has risen sharply. In addition to natural rubber, synthetic rubber prices rose sharply, the rubber raw materials, carbon black, rubber additives, skeleton material price rise or even more than rubber, compared with before the month of September last year some of the price increase has reached more than 100%, far more than the increase of economic growth in the past, promoted the tire prices. "The price of raw materials will not stop, and the prices of tire companies will not stop, or there is no way to transfer costs," Mr Shen said. It is understood that after a few months of rapid ascent, the price of tire has risen by more than 30%, but many enterprises reflect that there is still a big gap compared with the price of raw materials.
Second, in recent years, the enterprise environmental cost, labor cost greatly improve, society and market all need to improve the grade of products, green products, intelligent production inputs increase, these also increased the tire enterprise cost pressure. Again, strong market demand supports tire prices. Perhaps because of these factors, the price of rubber has risen sharply in recent months, although the price of rubber has gone down sharply.
In the price of natural rubber, the industry thinks that the price increases on the one hand due to demand growth, on the other hand due to capital speculation.
Mr Li argues that natural rubber prices are determined not only by supply and demand, but by capital. For example, the global production of natural rubber was 12.2 million tons in 2016, compared with 9.7 million tons in the year of the year, and the turnover was 12 trillion yuan. In this case, the actual use of natural glue is less than 5%, indicating that 95% of the non-rubber capital in the capital market is in the right rubber price. Therefore, it is not enough to judge prices simply by the supply and demand of rubber. It could also explain why China won a "double anti-war" lawsuit in February, when rubber prices did not rise sharply in the event of a big boost.
Therefore, li shiqiang's analysis, the reason that natural glue price rises sharply, besides the downstream demand obviously improve, still have a reason is a lot of money enters the rubber ring. At present, from the downstream demand, besides the actual production demand, there is also the expected demand, speculative demand, capital demand and haven demand derived from the capital market. Capital market sentiment fluctuates very big, in the past three years, the Shanghai glue appears dozen times the price of the daily fluctuation is around 1300 yuan, this is the supply and demand level cannot explain.
In addition, shen jinrong also suggested that the price of natural gum has a direct relationship with the price of synthetic rubber, and the correlation is greater. The price of synthetic gum caused by the shortage of butadiene may be maintained for a long time. This is due to the establishment of an ethylene route changed butadiene supply and demand, therefore the price of butadiene "ceiling" is the cost of naphtha preparation route of butadiene, the cost is much higher than the naphtha route.
When to "balance" the rubber and tire market
Li shiqiang believes that the price of rubber exceeded 9,700 yuan/ton in 2015, and the basic bottom has been reached. Now, the price of glue is on the way to the middle and lower reaches. Comparing Shanghai copper price, it can be found that the Shanghai copper delivery target is the main circulating variety, the spot participants, the market is running smoothly; The Shanghai glue delivery product and consumer market are out of touch, flooding speculation, price inflation and collapse. In the future, the price of natural rubber should go through three phases: the stage of industrial stability, the stage of value rebalancing and market speculation.
Shen said that in the aforementioned five factors that led to the increase in natural gum demand, in addition to the substitution of the fourth synthetic glue and natural glue, it will gradually return to normal. But when does it return to normal? He thinks it should continue for some time. At present, the total amount of transportation of the whole society is still increasing, according to the plan with the auto manufacturers, the demand will not decrease in at least April. Of course, it is certain that social buying will not buy or fall, and that is when all commodities begin to fall. In addition, the sharing of cycling fever will continue, it is now only in a second - and second-tier cities, and the government is supportive of the sharing economy, so the sharing of cycling hot has become more and more powerful.
In addition, the three main producing area of natural rubber in April to stop cutting, sharply reduce of supply, demand is still relatively prosperous, combined with early and consumes a lot of inventory, this time "mismatch" to bring strong natural rubber market.
According to the analysis, the recent continuous decrease of Shanghai glue, the increase of rubber import to the port, the obvious recovery of the rubber inventory in the bonded area, and the continuous increase in the number of stock warehouse receipts. The important reason for the rising of the futures natural plastic warehouse list is that the current price gap is so wide that the spot companies are willing to sell the rubber in the futures market. While the recent spread is not as wide as it was in the third and fourth quarters of 2016, it is still at a higher level than it has been in the past.
Shen Jinrong stressed that caused natural rubber demand from the five big factors, natural rubber and synthetic rubber alternative weight, the largest butadiene long-term shortage and the route of naphtha "ceiling" function at the same time, can expect synthetic rubber near a new price stabilized, natural rubber will stabilize near this price. "This is my understanding of the long-term pricing mechanism of natural gum. Is the main cause of this new pricing mechanism, because of the route is an ethylene butadiene market supply and demand has changed in the past, under the new state of supply and demand balance, new pricing pricing is much higher than the old."
Shen Jinrong finally concluded that, due to natural rubber stop cutting period and the market demand of "time mismatch", natural rubber prices will fluctuate, but after the periodic fluctuations occur all parties are happy to accept the price of the system; Due to the fluctuation of the price of butadiene, it has already touched the recovery of non-naphtha route and became its "regulator", which also created the conditions for the long-term stability of synthetic glue and natural glue. Synthetic rubber and natural rubber will be more and more reference for each other. In the new balance, the proportion of each dosage will be gradually fixed, and there will be a benign operation and relatively stable situation of the various parties of the tire factory, the rubber merchant and the rubber farmers.
