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Glass: Short - Term Price Still Has The Subsidy Water Kinetic Energy

  At the end of last year due to temporary environmental inspection, shahe area built before batch, batch building does not conform or do not get green emission permits, and so on and so forth all 9 production lines have been shut down, affect the daily output of about 5800 tons/day, about 3.8% of national output operation can, at the beginning of the supply side has the futures of boost one of the main reasons, and then under the industry highly profitable attract, capacity to recover gradually, and some mature production line due to the rising cost of industry profits can be stacked cold repair also chose to adhere to the production, thus lead to industry high capacity problem almost throughout the 2018 years, Until the end of the year after a substantial loss of profits, manufacturers gradually to the expiration of the production line of the cold repair plan. Therefore, the high supply in 2018 has suppressed the upper space of the glass price in the year without obvious boost from the demand side, and the aggravation of the contradiction between supply and demand has also created the downward trend of the glass price in 2018.


The ledo:

1. Manufacturers' inventory is relatively low, and year-end demand boosts market confidence;

2, the price of a large discount spot price, a short time there is still subsidized water kinetic energy.


Bad:

1. The real estate policy is tightening, and the number of downstream orders falls by 30% in 2018, and is expected to continue to fall in 2019;

2. Although there is a reduction in expectations in the long term, it is difficult to effectively solve the problem of overcapacity in the short to medium term, and the contradiction between supply and demand will lead to price decline;

3. Winter orders have gradually declined, glass inventory under high production capacity will rapidly accumulate, and overall supply will be loose after the Spring Festival.


Conclusion:

The current spot market price is close to the top area before the winter storage policy is introduced. In the later stage, with the successive shutdown of downstream demand and the rapid rise of inventory, the high price cannot be sustained for a long time. In terms of futures market, 05 contract price is still lower than the expected price of winter storage, there is still short-term subsidy water kinetic energy, the operation suggests short-term wait-and-see, waiting for the price to rush to the winter storage price above the layout of the long term single entry.