The impact of the off-season gradually weakened

The impact of the off-season approached the end, and the downstream demand gradually improved.

Since June, with the northern climax of busy agriculture, and the beginning of the southern rainy season, the glass has entered the traditional low season, the downstream demand has gradually weakened, the manufacturers have been blocked, and the inventory has rebounded for the second consecutive week. The purchase pace of traders and deep-processing companies has been increasing. slow. Some manufacturers in South China and Central China to accelerate the withdrawal of funds, and some leading companies to consider for the annual financial report, so began to increase promotional efforts in order to speed up the speed of the existing inventory, in Qibin, Xinyi and other companies Driven by other manufacturers in the south, the price reduction in southern China gradually spread to other regions, which has a great influence on market confidence. Compared with southern China and other places, the market atmosphere in North China, represented by Shahe River, is relatively good. Although the agricultural production and environmental protection regulations have caused the production and sales of production enterprises to fall, the inventories are still in a reasonable range. Therefore, most manufacturers are not willing to cut prices, and many are Price sales, of which some SMEs to reduce the inventory to reduce the offer, but the majority of corporate prices remained stable. With the end of the busy farming industry in the north and the weakening effects of the rainy season in the south, the spot market has also stabilized. Manufacturers gradually realize that even in the off-season, even if the price reduction has a relatively small impact on the warehouse, the spot price starts to stop falling and hopes to take time. Change space, and adjust after market demand improves. In July, with the disclosure of the company's year-end statements, the company's late price adjustment may be significantly reduced, and the spot price of glass may rise steadily. Demand falls in the off-season, but inventory is still low

In the off-season, the downstream demand for glass declined, and the manufacturers' inventory was blocked. Industry stocks rebounded in three consecutive weeks, but compared with the same period of the calendar year, they remained at the lowest level in nearly four years. Compared with 2016, the real estate market rebounded due to policy influence. The growth rate of completed housing rose to 20%, while the production of flat glass in the same period was just -1.2% to -2.5%, compared to this year's housing growth rate fell to 10%, while the flat glass production in May increased To 8.9%, absolute supply is still lower than last year when supply and demand are weaker than last year. In terms of inventory days, the current inventory days are approximately 13.1. The inventory days in the same period in 2013 and 2016 are 12.3, 13.9, and the inventory days in 2014 and 2015 are 12.5, 14.7 days, respectively. Lower position. The correlation between the price of glass and inventory is relatively high, and the lower inventory pressure makes manufacturers willing to sell at a higher price in the off-season, and it is favorable for the price to rise after the demand improves. From the perspective of inventory levels over the years, from July to September, the industry inventory generally fell continuously, hitting the low point in the traditional peak season in September/October. Therefore, the decline in the late inventory is expected to support the continued rise in glass prices.

Newly-launched property starts to maintain a high level in the early stage, and the glass season is expected to land

In general, the demand for glass lags behind that of real estate sales for 2-3 quarters. Since 2016, housing sales have continued to maintain a high level. Although the recent real estate regulation has gradually taken effect, the impact on glass demand in the second half of the year has been relatively small, and we have seen that The growth rate of new housing starts fell sharply in May, but it is still above 10%. The high growth rate of new housing starts since the second half of last year will reduce the growth rate of the completion of the later period. The historical situation shows that the area of completed houses has increased in the second half of the year. The proportion of speed in the whole year is about 65%. Combined with the new construction data in the previous period, the probability of landing in the peak season in September and October is relatively large. In late July, glass demand will enter the busy season with the construction of the house. In the case of low inventory, the glass price will have the momentum of further increase, and it is expected to further rise to the previous high.

Outlook

Under the support of inventory, housing construction and cost-side support, as the impact of the off-season weakened, demand gradually improved, and the glass price started to rebound. The rebound of spot prices will drive up the price, which is due to the strength of black goods combined with the disk. There is room for further upswing. Short-term or short-term shocks will be sorted out around the previous high of 1360. After the end of the southern rainy season in the mid-term, with the inventory ringing down, the glass futures price will advance towards 1400 yuan. Operation, unilateral and more than one can only stay away from the profit, 9 and 1 continue to hold.