Daily Report 260515 2015-05-26
Macro Economy

Data released the state owned corporate earnings from Jan – Apr fell 5.7%, the gross turnover fell 6%; industry as coal, steel, nonferrous had deficit. National Development and Reform Commission (NDRC) issued recommendation project which collaborate with government and social capital (ppp), total 1043 pieces projects, gross 1.97 trillion RMB investments. The project contains several areas as water conservancy facilities, municipal facilities, transport facilities, public service, resources and environment. The national treasury issued China had decrease partial consumer product import tariff rate like clothing, footwear, skin care, paper diaper, average deceasing range overrode 50%.


Soybean

On Monday the U.S financial market closed up due to Memorial Day, DCE soybean overnight market rebounded. Soybean No.1 contract overnight market slighted increased. Calculate from spot price, contract 1509 had larger sell delivery pressure on RMB 4450-4500/ ton, in this position still attract the sell side delivery market get involved. Although recent market speculating the sowing area of domestic soybean has been reduced, the decreasing range is waiting for affirm. The spot will face sales pressure; maintain the short opportunity above the cost of warehouse receipt.
Soybean meal continues decreasing, quotation from Guangdong and Guangxi area break RMB 2600/ ton. Due to the May – Jul soybean expectation arrival amounts will over 22million ton, whereupon oil meal supply pressure will be obviously. In the next months is the inventory increasing stage, along with the flat demands of breeding procurement presently, it is expected the meal price will remain weak trend.
As for operation, hold the empty single meal type.


PP

Yesterday PP futures low opening with volatile, opened up RMB 8375, closed at RMB 8403, the volumes dropped 111000 lots to 407000 lots, and the holdings dropped 3770 lots to 482000 lots. On the upstream hand, propylene price hold the line. On the devices hand, Pucheng Clean Energy put 300000 tons of capacity to reproduction. On the spot side, yesterday partial domestic PP market price increased, raised RMB100-200/ ton. Petrochemicals of east China, south China and north China had increased ex-factory price, the bolster of goods supply cost in market had increased, and agency made high price shipment. But the trade didn’t follow up; the downstream manufacturers should wait cautiously, purchase as rigid demand.
Main quoted wires prices of north, east and south markets are 8900-9100 yuan/ton, 9200-9400 yuan/ton and 9250-9400 yuan/ton, respectively. For operation strategy: current moving average system is bullish, and MACD is shortened. Although in the rebound, fundamentals expectation is low, it is possibly remain volatile recently.
                                                                                       Dong LV (Investment Certificate NO. TZ008452)