Daily Report 300516 2016-05-30
Soybean
Domestically, DCE soybean fluctuated. Oil against meal ratio repeated at low point, focus on exchange of strong and weak. Spot goods side, soybean price of North and South China is strong and stable. Purchase and sales of all districts is plain. Market filtered goods purchase price is RMB 3900-4000/ton. Soybean with high protein is little. Spring sowing of Northeast China is nearly finished. Future soybean storage auction time has not decided yet, market observation mood is strong. Short term price is under consolidation stage. Soybean meal side, spot goods performance is strong. Oil plant quotation is around RMB 2950-3000/ton. The increase of futures market stimulated downstream deal mood. Since we hold the opinion of fluctuation and strong tendency for US section, and domestic breeding recovery situation is good, soybean meal is long in the middle term. As for operation, soybean meal long position is held when rollback happens, and arbitrage between oil and meal observe temperately, and the ratio is 2.05:1.
 

 
Copper
Last week copper price rallied, but rally motion weakened at the end of last week. The Fed president Yellen claimed at Harvard University speech that if data has not recovered, it’s appropriate to raise interest within several months. During the time that the expectation of the Fed interest hike is boosting, Yellen’s speech increases market’s expectation for interest hike. US dollar index continues to be strong, and copper price is limited by it. Back to fundamental side, last week LME spot market premium increased significantly, which was $25.5 during the weekend. Domestic spot goods price maintains premium 40 yuan to premium 90 yuan; Friday was premium 50 to premium 80. Copper price declined to the lowest point recently at first-half of last week; downstream trading is active. Last week three exchanges copper storage decreased 40000 tons to 430000 tons. The decrease is mainly from Shanghai futures exchanges, which is 36000 tons. From supply perspective, Chile National Mine first quarter copper output increased 11% year-on-year to 437000 tons. Output of ChuquicamataRadomiroTomicHalesTeniente increased, while Gaby and Andina decreased. The company is reducing cost sharply, which decreased to $1.25/pound. Technically, recently copper price is rallying, and fluctuation in short term can’t avoid. Observe first and wait for new short opportunity.
 

 
PP
Last week PP futures fluctuated sideways. Upstream, till Friday night, FOB Korea propylene average price was $690.5/ton. Spot goods side, last week PP market rallied after dropping; total fluctuation is not big. Sinopec enterprises bolster market with stable market; traders sell with market price. Downstream factories purchase willing is not big; trading and investing turn to plat. Each trade happened after negotiate. Intraday main quoted prices for wires of north China, east China and south China markets are RMB 6750-6800/ton, RMB6800-6900/ton and RMB6750-6850/ton, respectively. Current moving average system still arranged in short, which is downward trend. A weak tendency is expected recently.
 
                                                                         Dong LV (Investment Certificate NO. TZ008452)