Beginning In 2020: 20 Million Production Capacity Shutdown, Social Average Stock Of 20 Days + Where Will The Textile Chemical Fiber Go?

In 2019, the big guys said that 2019 is the most difficult year in the past ten years, but it is also the best year in the next ten years.

At that time, I thought it was a laughing word. In the early spring of 2020, when the whole nation welcomed the new year, Wuhan, a world class metropolis with more than 10 million population, suddenly declared "sealing the city". As a person born in 80s, this is a historic event, because no such major government action has been seen in memory, which is aimed at resisting the new pneumonia that has been out of control in the city.

At the earliest time, the pneumonia was transmitted to SARS as a "comeback" or upgraded version. But in the subsequent news, a lot of so-called "truths" that seemed to be suppressed for a long time began to burst out. Compared with 17 years ago, the internet almost has a leap in nature, because everyone is an autonomous voicing speaker. After 23, what is the first thing you ask the whole nation to wake up? It must be a cell phone to see how many cases are added today. And what unrest of the vagrants came to the new cases because of their rampage. For a time, everyone was in danger.

With the first extension, most people began to miss working. As a result, a more stringent urban management measure has been issued. Entrepreneurs strictly prohibit XX from returning to work and writing this XX day because the date is almost always changing. From February 3rd to February 10th, the first thing I heard was not earlier than February 17th. Is it really possible to start work in February 17th? No one dares to vote.

These days people have been calling to ask, what will happen behind the market? I think we should be able to sort out some data and share our views with you.

Up to the 2.6 th, we have counted the equipment plan and arrangement of dozens of polyester factories and associated stone chemical plants in February, and the corresponding inventory structure.

　　 The above data can see that the basic selection of 10-50 tons of polyester has stopped, while the 500 thousand tons above scale factories basically reduce load stage, involving a total capacity of more than 20 million tons.

According to the latest 5500 polyester scale in 2019, the total market load rate is expected to be 64%, and this data will be further reduced with the development of the epidemic.

In addition, the inventory impact caused by continued production during the new year also presents polarization. 10-50 million tons of factory inventory remained in 17-22 days, while more than 500 thousand tons of scale factories had more than 30 days of inventory, some of which exceeded a large number of factory stock for nearly 40 days.

More than 90% of the majority of small and medium textile enterprises are in a state of shutdown. Some medium-sized enterprises, which had not stopped in the new year, were also forced to stop recently because the supply of auxiliary materials was insufficient. Logistics is still not able to recover at this stage. The big reason is that "foreigners can not return home", and even if they return home, they will be asked to "stay out" temporarily.

So even orders can not be answered. This is the current situation in the lower reaches, which can neither be bought nor sold, nor can it be opened. In addition to having to enjoy this decades of difficult holidays, the rest is to brush phones at home. Instead, there will be greater demand for information in the market. In 2020, the chemical fiber industry will be faced with a wave of online upgrading.

In other words, let's look at the futures market that opened earlier than we did.

　　 As expected, the first day of the market was limited. Many operators in the industry or outside the industry call to ask if they will continue to explore further. How far will the market go?

In fact, this question is not difficult to answer. I have only one question. Is the market so bad? Do you dare to go short? Almost everyone at the end of the phone said, "I dare not." Why not?

The reason is also very simple, because disk prices have been close to historic lows. What is the low point of history? It happened in 2015, about 4207 yuan. 15 years to date, compared with the cost of oil at that time, oil prices were also near 50.

History is always repeating itself inadvertently, and we need to understand how to follow history. At the same time, we must understand a simple reason that commodities can not be free of money, and goods can not be sold continuously.

Following these two points, we can see a clear direction in the direction of operation logic. The decline in the market is actually giving a new opportunity, because based on the logic of cost analysis, the risk of shorting will be greater. The bottom of the bottom may be very close. Once a gun is returned, it will probably be killed.

Then can we buy more directly? If your money really goes to the index finger and you have nowhere to go, you can light up the first phase, but if you are prepared, you may be able to return to the next city. If this is not the case, departure is the first choice. I know that the market will come back, but first we have to wait for the signal to rebound. This is the view of most people nowadays.

Chart 1 maintenance of PTA plant

Chart 2 maintenance of MEG plant

　　 From the analysis of inventory and start-up load, we can see that the overall inventory is basically maintained at a relatively normal level, or even locally. Terminal textile enterprises basically exist for 7 days or even less, because it is the same as buying later. Therefore, when the follow-up is gradually resumed, the pulse sales state may continue to appear, but this impulse sales bottom price will also gradually increase. Once the product price falls to the margin of safety, the market will be snapped up. But some big factories know that they will encounter malicious purchases.

Because the difficulty in storing cash and the requirement for capital occupation will force them to accept passive sales. And hedging, the factory will choose to do more in the disk market, in order to protect the sale of finished products. In this way, the disk will mean strong support.

It can be concluded that the market inertia will decline with the macro level, but it will never encounter panic selling. The market has strong support on the cost line. Maybe a better suggestion is to prepare bullets. Flying for a while may be a good time for the trigger.

When it comes to spring blossoms, we believe that the chemical fiber will usher in a small spring. This is an opportunity that can not be lost in 2020, always ready, maybe in May.