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SunSirs: Energy, Individual Oversold Resources Increase, and Coke Market Shocks and Rebounds

March 25 2020 09:59:23     SunSirs (Selena)

Futures: Coke opened higher on Tuesday, March 24, closing at 1,795.5 (up 30.5), with a total of 10,477 positions reduced and trading volume decreased. With the spread of COVID-19 overseas, the prevention and control of multi-national monetary easing was strengthened, the Federal Reserve bought unlimited US bonds and MBS, and the black energy varieties bounced back after opening. After continuous increase and decrease, coke profit is low, coke prices are propped up, and some early oversold resources are slightly increased. Coke rebounds and fluctuates in a short period of time. Pay attention to market factors, fund initiative and change of supply and demand rhythm.

Spot: the coke market as a whole is generally transacted, and some areas are shipped smoothly. Port inventory: Rizhao Port 114 (up 3), Qingdao port 165 (flat). Quotation of metallurgical coke: Rizhao grade II 1750, Tangshan grade II 1,700, Linfen grade I 1,600. In terms of coke enterprises, the supply is still relatively stable. After four rounds of lifting and lowering, coke enterprises' overall profit is low, and some oversold resources have been lost, so their willingness to hold prices has begun to increase; the port collection volume has increased, but the inquiry, offer and transaction are still relatively cold. As for steel mills, the output and apparent consumption of weekly building materials continue to increase, the blast furnace operation rate tends to increase steadily, the inventory pressure of most steel enterprises is still dominated by on-demand procurement, the pace of price reduction slows down, and the short-term stable operation of coke spot.

Strategy analysis: at present, the government strengthens macro-control, loose policies release liquidity to stabilize the market, fully promotes resumption of work and production, and increases counter cyclical adjustment. The spread of COVID-19 overseas, the implementation of monetary easing policy in many countries, the collapse of OPEC agreement on the crude oil, and industrial products in the global stock market were under pressure. In the near future, the inventory of building materials and social inventory of the downstream steel plants began to drop, the domestic demand gradually recovered, and the overall wide fluctuation of futures and spot goods. Under the favorable influence of domestic and foreign easing policies, the demand in the second quarter may continue to be strong, which has certain support for the low price area of black energy varieties.


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