There is a certain space above the polyolefin when the raw materials enter the passive destocking stage
2023/9/6
The industrial inventory cycle is still in the destocking stage
From January to July 2023, the inventory of finished products of industrial enterprises above designated size nationwide increased by 1.6% year-on-year, a decrease of 0.6 percentage points compared to January June; Industrial enterprise inventory decreased by 0.2% year-on-year, an increase of 0.1 percentage points from January to June; The operating revenue decreased by 0.5% year-on-year, with a decrease of 0.1 percentage points greater than that of 1-6; The total profit decreased by 15.5% year-on-year, a decrease of 1.3 percentage points compared to January June. The inventory of industrial enterprises is in the stage of active destocking, and the profit margin of industrial enterprises continues to be good, while the operating income margin is still weakening, and the destocking cycle fluctuates at the bottom.
From January to July, out of 41 major industrial industries, total profits in 13 industries increased year-on-year, while 28 industries decreased. The profit situation of the main industries is as follows: oil and gas extraction industry decreased by 11.4%, coal extraction and washing industry decreased by 26.2%, chemical raw material and chemical product manufacturing industry decreased by 54.3%, oil, coal and other fuel processing industry decreased by 87.0%, oil, coal and other fuel processing industry decreased by 92.3%, rubber and plastic product manufacturing industry increased by 11%, electrical machinery and equipment manufacturing industry increased by 33.7%, automotive manufacturing industry increased by 1.0%, computer The manufacturing industry of communication and other electronic equipment decreased by 26.4%.
Different paths lead to the same destination for upstream and downstream storage of polyolefins
The total profit of the rubber and plastic products industry from January to July 2023 increased by 12.5% year-on-year, an increase of 1.5 percentage points compared to January to June; Operating revenue decreased by 3.1% year-on-year, a decrease of 0.7 percentage points compared to January June. The inventory of finished products decreased by 0.4% year-on-year, a decrease of 0.4 percentage points compared to January June; Inventory decreased by 1.9% year-on-year, a decrease of 0.4 percentage points compared to January June. The profit of the rubber and plastic products industry has significantly improved. After bottoming out in January February, the year-on-year growth rate in January April turned positive for the first time, and then gradually expanded month on month. It has maintained a positive growth rate for four consecutive months. However, in terms of operating revenue, although it maintains negative growth rate, it narrows month by month.
The total profit of the chemical raw material and chemical product manufacturing industry from January to July 2023 decreased by 54.3% year-on-year, showing negative growth for 9 consecutive months, with a decrease of 2.1 percentage points compared to January to June; The year-on-year decrease in operating revenue was 7.9%, which was 0.6 percentage points narrower than that of January to June; The inventory of finished products decreased by 4.1% year-on-year, an increase of 3.6 percentage points compared to January June; Inventory decreased by 5.8% year-on-year, a decrease of 2.5 percentage points compared to January June. The inventory cycle of the rubber and plastic manufacturing industry will ultimately be consistent, and both will enter the passive destocking stage, which will be a stage of price increase and contraction.
It is worth noting that due to the entanglement of the inventory removal cycle in the automotive manufacturing industry, the total profit of the automotive manufacturing industry increased by 1% year-on-year from January to July, a decrease of 9.1 percentage points compared to January June, and the operating revenue decreased by 1.3 percentage points; In the home appliance manufacturing industry, profits increased by 33.7% year-on-year, a decrease of 5.4 percentage points from January to June, while operating revenue decreased by 1.0 percentage point. The volatility of the automotive and home appliance manufacturing industries during the destocking cycle has led to an unstable recovery in their prosperity. The revenue and profit of the automotive manufacturing industry have both decreased year-on-year, while the profit of the home appliance manufacturing industry still maintains a high growth rate.
The price of polyolefin raw materials entering the passive destocking stage is secure
Overall, the year-on-year decrease in profits of industrial enterprises in July showed a trend of narrowing month by month, mainly benefiting from the steady recovery of domestic demand, the gradual narrowing of the decline in industrial product prices, and the gradual effectiveness of policies to promote consumption and expand domestic demand. The domestic economic cycle is gradually unblocked, market demand is gradually recovering, and some industrial manufacturing industries are approaching the end of their destocking cycle. Industrial product prices continue to improve, and the overall operating conditions of the industrial sector are expected to continue to improve. However, the industrial sector still faces challenges such as weak market demand, sluggish real estate market, and uncertain export prospects. In the short term, polyolefin raw materials are still fluctuating in the cycle of mismatch, and high levels will fluctuate with crude oil. In the long run, there is still some room above polyolefins, and buying long on dips is still acceptable.
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