Metallurgy / Chemicals / Rubber & Plastics

The rubber oscillated sharply after rebounding. In the night trading on July 2, rubber Zhongyang rebounded. The night market continued to rebound on July 5. The night market on July 6 pulled back sharply and fluctuated. We remain calm and our views remain unchanged. If RU2109 is below 13000, we are gradually not pessimistic about rubber prices. If the rebound is too fast, we should be cautious. The sales peak of the National Sixth Standard is about to pass, and the future demand for heavy truck tires is expected to weaken slightly. After June, as the peak season for rubber supply in Thailand begins, supply pressure is expected to increase.

At present, domestic rubber maintains a relatively high inventory of close to 800,000 tons, and tire factory inventory has increased, and operating rates have fallen. It is expected that rubber prices will fluctuate in the later period. But when the absolute price is not high, the market is prone to rebound.

What about the industry? The economy is picking up, but it may be difficult to continue. As of July 2, 2021, the Shanghai Futures Exchange has 184,286 (752) tons of natural rubber stocks and 174,650 (-170) tons of warehouse receipts. The inventory of No. 20 rubber is 55,631 (-2027) tons, and the warehouse receipt is 53,192 (-635) tons. Qingdao + Exchange rubber inventory (10,000 tons) 78.36 (-4.71). Due to the hindrance of export and shipping, tire domestic sales are not prosperous, and tire factory operating rate is expected to fluctuate. At present, the impact of tight export space and high sea freight rates will continue, the export delivery cycle will be extended, and the pressure of export stagnation will continue. Therefore, the expected subsequent operating rate is also difficult to exceed expectations. The spot price of compound glue in the spot market was 12000 (100) yuan from 16:00-18:00 in the afternoon of the last trading day. The standard rubber spot is 1,640 (10) dollars.

Operational recommendations: We are not pessimistic about the price of glue. Our current recommendation is for conservatives to wait and see for the time being, and for active ones, the band is shorter in the lower box. The market is expected to fluctuate at a low level. The risk of US stocks has not been released, and crude oil has risen too much. If it pulls back, it will drive down risk sentiment. Caution and risk control are important.