Printing And Dyeing Giant Wave Of Price Impact On Performance Has Not Yet Appeared.

600352.SH, one of the giants, issued a notice in the evening of March 20th, which raised the price of the domestic dye products, and the price range was 50%-60%.

According to the announcement, the price increase is based on the upstream and downstream industries.

Appropriate measures to be taken.

Zhejiang Longsheng said in its announcement that

The main reason for the price adjustment of dyestuff products is tight supply, environmental protection, centralized orders to large enterprises, and early inventory clearance.

In addition to Zhejiang Longsheng, another large printing and dyeing giant, run shares, also told reporters that they are ready to raise prices in the near future.

Some brokerage analysts believe that the dye printing industry will usher in a wave of price surges, and the overall profitability is expected to be improved.

However, the impact of the sharp increase on the performance of Listed Companies in the first quarter of this year, and how long the price will last, Zhejiang Longsheng and run earth shares did not give a clear answer, the other side said that the industry "follow the market", there is no clear timetable.

Printing and dyeing giant wave of price surges

According to Zhejiang Longsheng announcement, in March 20, 2016, some products of disperse dyes were raised by 3000 yuan / ton again, and some products of reactive dyes were raised by 5000 yuan / ton again.

Since March this year, the cumulative up-regulation of disperse dyes is in 50%-55%, the cumulative up range of reactive dyes is 55%-60%, the accumulative increase of acid dyes is about 15%, and the coverage of the up-regulated dyestuffs is about 60%.

For the reasons of price adjustment, Zhejiang Longsheng has given three reasons: first, there is a tension in the supply of dyestuff raw materials, and the supply of dyes and raw materials manufacturers is limited due to environmental reasons. Among them, supply of disperse dyes, such as reducing raw materials, hexachlorides and six bromine, are all tight. The market quotation of raw acid for living dye raw materials has risen from 27 thousand yuan / ton at the beginning of the year to 50 thousand yuan / ton now.

Reporters noted that recently reported that the largest domestic acid manufacturer Hubei Chu Yuan suspended production because of environmental reasons.

The price of H acid rose from 27 thousand / ton to 51 thousand / ton in two weeks, which promoted the price of reactive dyes, because H acid accounted for 20%-30% of the reactive dye cost.

In addition, Zhejiang Shaoxing started to focus on the rectification of the printing and dyeing industry, and also accelerated the printing and dyeing industry to rise from the middle to the high-end. A large number of small and medium-sized printing and dyeing enterprises were discontinued, resulting in a change in the market demand pattern. The printing and dyeing orders were concentrated on large enterprises, making large enterprises begin to run at full capacity, and the demand for dyestuffs began to flourish in March from the traditional peak season.

Notice also mentioned that since last May, due to the fall in dye prices, dye enterprises and company dealers have been consuming inventories. After the Spring Festival, inventory is coming to an end. The inventory of downstream printing and dyeing enterprises and company dealers has been low. The rebound in prices has accumulated a lot of time and energy. Any rebound in links will lead to rising demand, and the rise in demand will lead to price increases.

The analysis of brokerages also partly confirmed the reason why Zhejiang Longsheng raised its price.

In March 21st, Xingye securities analyzed in the research report that in the second half of 2015, the price of disperse dyes quickly dropped sharply, resulting in the clearance of small and medium capacity. Longsheng, Ru Tu and Ji Hua effective capacity accounted for 70%-80% of the market, and the industry alliance had strong price control power.

Early inventory clearance makes the demand for replenishing inventory bigger now.

The price of pre dyestuffs is lower than the cost of some enterprises, so enterprises have strong demand for raising prices.

There is still a notice of price increase in the stock market, but the other securities department confirmed to reporters that there will be a price adjustment plan, which may soon be announced.

The impact on performance has not yet been revealed.

After the new year's day last year, the price of domestic dyestuffs has soared more than 10 times, but it began to drop sharply after mid May, of which the price of reactive dyes was generally reduced by around 10 thousand yuan per ton.

At that time, the industry analysts believed that the price rise at the beginning of the year was due to insufficient supply of raw materials, and the price drop was normal as the upstream raw material production resumed in the second half of the year.

At that time, the view of whether or not the price of the market was going up was analyzed. According to the analysis of the industry, with the increase in the intensity of the remediation of the high polluting industries, the production and production restriction of the dyestuff industry often appeared due to environmental protection reasons, and the dye production capacity would still be affected. However, due to the low demand for the downstream, the price of dye will remain relatively stable under the influence of both.

The industry is not optimistic about the trend of dye prices going down in the future, but since the first half of 2015 continued to rise, unless there is a sudden factor, otherwise the market will not increase too much.

Zhejiang Longsheng's announcement on price increase also stated specifically that the price adjustment was compared with the end of 2015, but the price of disperse dyes, reactive dyes and acid dyes dropped by about 35%, 6% and 16% compared with the first quarter of 2015.

Public information shows that the domestic dyestuff business income currently accounts for about 25% of Zhejiang Longsheng's total business revenue, and Zhejiang Longsheng three quarterly report 2015 shows revenue of 11 billion 777 million, an increase of 2.35% compared with the same period last year, after deducting net profit 1 billion 535 million, down 12.01% over the same period last year.

Will the price adjustment produce new changes in the first quarter of this year?

Zhejiang Longsheng Securities Department told reporters that the price increase is mainly driven by the rising cost of raw materials, while the price of dyestuff outside the company has not yet been clearly priced, but it does not rule out the timely adjustment of the price of dye according to the local market and raw material price trends. Now the financial sector estimates that the impact on the overall performance is limited.

Zhejiang Long Sheng said that the price is responsible for the company's finance department, and how much time it will last for the financial department.

The announcement said that if the price of the current dye rose for a long time, it would enhance the overall performance of the company.

Intercontinental Stock Securities Division also told reporters that the price adjustment and duration of the printing and dyeing industry is a process of "going along with the market". It should be decided according to the specific circumstances. There is no clear statement now, but the price adjustment is positive. As for how big changes will be reflected in the quarterly performance, we need to wait and see.

Guoxin Securities said in the research report, combined with the cost of printing and dyeing and the price increase of disperse dyes, it is judged that the dye printing and dyeing industry has ushered in the improvement of profitability.