I. Trend analysis

According to the monitoring data of business associations, the domestic cobalt market fell more than once in June, and the overall cobalt price was unable to rebound. As of June 30, the cobalt price was 233166.67 yuan/ton, down 3.78% from 242333.33 yuan/ton at the beginning of the month. Compared with the same period last year, it fell 56.02%.

II. Market Analysis

International Cobalt Price Falling

The international market MB cobalt price fell sharply in June, the global cobalt market was cold, the international cobalt price rose powerlessly, and the falling international cobalt price dragged down the domestic cobalt market.

The price of cobalt in LME market fluctuated and fell in June. The international cobalt market lost its momentum to rise. The global cobalt market was obviously short, while the domestic market was dragged down.

Cobalt Price Index Approaching Historic Low

On June 29, the Cobalt Commodity Index was 83.87, unchanged from yesterday, down 64.89% from the cyclical peak of 238.91 points (2018-04-15), and up 20.09% from the lowest point of 69.84 on July 05, 2016. (Note: Period refers to 2011-09-01 to date). Domestic cobalt prices continued to fall, approaching the historical status of cobalt prices, cobalt prices fell in limited space.

Sales of New Energy Vehicles

According to the data released by the China Automobile Industry Association, in May, the production and sales of new energy vehicles totaled 112,000 and 104,000 respectively, up 16.9% and 1.8% respectively from the same period last year. From January to May, the production and sales of new energy vehicles reached 480,000 and 464,000 respectively, up 46.0% and 41.5% respectively from the same period last year. New energy automobile sales increased in May, but the growth rate further slowed down. The overall downward trend of industry production and sales has not been effectively alleviated. The demand of cobalt market is lower than expected, which is bad for cobalt market. Since June 26, the new energy automobile subsidy policy began to be implemented in 2019. Not only will the local government subsidies be cancelled, but also the national subsidy standards will be reduced by more than 50%, and the overall subsidy decline will exceed 50%. The sharp decline in subsidies has created a major negative impact on the cobalt market, and the subsequent cobalt price rise is weak.

Increased demand for cobalt due to increased sales of mobile phones

According to the data of CITIC, in May 2019, the total shipment of mobile phones in the domestic market increased by 1.2% and 4.8% year on year. From January to May 2019, the total shipment of mobile phones in the domestic market dropped by 4.8% compared with the same period in 18 years. Although the sales of mobile phones in 2019 still declined compared with the same period in 18 years, the steady increase in sales of mobile phones in April and May brought good profits to the market and increased sales of mobile phones. The demand of dynamic cobalt market is favorable to the demand of future cobalt market. However, the growth of mobile phone sales is difficult to compensate for the impact of declining sales of new energy automobile subsidies on the cobalt market. The overall demand of the cobalt market has fallen and the rise is weak.

Lithium Battery Production Rises Steadily

According to the statistics of CIIB, the output of lithium batteries rose steadily in 2019, up 7.2% in May compared with the same period last year. The growth rate declined slightly, and the output of lithium batteries maintained a high growth rate. The output of lithium batteries has a certain supporting effect on the demand of cobalt market. The demand of cobalt market increased steadily and the overall cobalt market is favorable.

policies and regulations

On June 6, the State Development and Reform Commission, the Ministry of Ecological Environment and the Ministry of Commerce jointly issued the Implementation Plan for Promoting the Renewal and Upgrading of Key Consumer Goods and Unobstructed Recycling of Resources (2019-2020) (hereinafter referred to as the “Plan”), which takes the structural reform of the supply side as the main line, and focuses on promoting the upgrading of automobile, household appliances and consumer electronics products from four aspects of “consolidation, enhancement, promotion and smoothness”. Promote the recycling of old products. The introduction of the scheme has obvious advantages for automobile and household appliances industries. It is expected that the demand for cobalt in automobile and household appliances industries will rise in the future, and the demand for cobalt in the future will rise, which will have obvious advantages for cobalt price. However, the impact of policies and regulations has a certain lag, and the cobalt market has insufficient momentum to rise in the short term. But the overall future cobalt market is good.

Future prospects:

Bai Jiaxin, a data analyst at Business Society, believes that June is the first month of the implementation of the new policy of subsidizing new energy vehicles. There is a lot of room for new energy vehicles. The new energy automobile industry is facing a shuffle, which has a significant negative impact on the demand of cobalt market, resulting in a sustained decline in cobalt prices. International cobalt price and domestic cobalt price affect each other, resulting in more and more declines in cobalt price. But in a downward trend, we can see a few bright lights. With the approaching of 5G era, mobile phone sales began to pick up, lithium battery production continued to grow, the basic demand of cobalt market was stable, and the pressure of cobalt price drop was relatively small. The national consumer upgrading policy promoted the upgrading of automotive products, which had a better sales of new energy vehicles, offset a part of the subsidy downhill guide. As a result of the decline in sales, domestic cobalt prices are historically low compared with cobalt prices, and there is limited space for cobalt prices to fall. From the above, we can see that the cobalt price will fall slightly in the near future or still in the short term, but the space for the cobalt price to fall is limited, and the future market rise may increase. With the gradual warming of cobalt Market demand, cobalt prices in the future may usher in a long-term slow rising period. In July, the supply-demand relationship of cobalt market has not changed fundamentally, and there has been no good or bad news in the near future. The fluctuation of cobalt price in the future slows down. It is expected that the fluctuation of cobalt price will remain stable in July.

On June 27, the ammonium nitrate commodity index was 103.51, which was the same as yesterday. It was 12.59% lower than the peak of 118.42 points in the cycle (2019-01-15), and 33.79% higher than the low of 77.37 points on October 31, 2016. (Note: Period refers to 2013-02-01 to date).

Recently, the price trend of domestic ammonium nitrate Market is temporarily stable. Affected by environmental protection control, domestic ammonium nitrate plant shuts down more, domestic ammonium nitrate plant starts less, but with the warming of the weather recently, the influence of northern air limitation disappears. In addition, due to the complete shutdown of domestic downstream civil explosion industry, domestic ammonium nitrate manufacturers have more stockpiles, and the price trend in the field declines. As of the 27th, domestic ammonium nitrate market price negotiations in 1900-2050 yuan/ton, affected by environmental protection, so now many manufacturers in many areas are forced to limit production or stop production and maintenance for environmental protection inspection, the price trend of ammonium nitrate on the site is temporarily stable.

Recently, the domestic nitric acid price trend has been stable. The market price is 1800 yuan/ton as of 27 days. The rising trend of nitric acid price has a positive impact on the ammonium nitrate market, and the price trend of ammonium nitrate is stable. The price trend of liquid ammonia in upstream raw material has slightly declined. The price quoted by manufacturers in northern region has been maintained in the range of 3000-3400 yuan/ton as of 27 days, while that in northwest region is around 290-3000 yuan/ton. The declining price trend of cruise raw materials has a negative impact on the ammonium nitrate market, and the price trend of ammonium nitrate Market is temporarily stable. At the end of the peak season of the downstream civil explosion industry recently, the demand for ammonium nitrate has weakened and the stocks of ammonium nitrate manufacturers have increased, but the liquid ammonia market is on the rise again. The ammonium nitrate Market is shaking at a low level because of the bad market. Ammonium nitrate analysts believe that the recent upstream raw material market price shocks, but the downstream demand is not good, ammonium nitrate market prices are expected to maintain shocks in the later period.

On June 26, the ammonium nitrate commodity index was 103.51, unchanged from yesterday, down 12.59% from the peak of 118.42 points in the cycle (2019-01-15), and up 33.79% from the low of 77.37 points on October 31, 2016. (Note: Period refers to 2013-02-01 to date).

Recently, the price trend of domestic ammonium nitrate Market is temporarily stable. Affected by environmental protection control, domestic ammonium nitrate plant shuts down more, domestic ammonium nitrate plant starts less, but with the warming of the weather recently, the influence of northern air limitation disappears. In addition, due to the complete shutdown of domestic downstream civil explosion industry, domestic ammonium nitrate manufacturers have more stockpiles, and the price trend in the field declines. As of the 26th, the domestic ammonium nitrate market price negotiations in 1900-2050 yuan/ton, affected by environmental protection, so now many manufacturers in many areas are forced to limit production or stop production and maintenance for environmental protection inspection, the price trend of ammonium nitrate on the site is temporarily stable.

Recently, the domestic nitric acid price has risen, up to the 26th, the market price is 1800 yuan/ton. The rising trend of nitric acid price has a positive impact on the ammonium nitrate market. The price trend of ammonium nitrate is stable. The price trend of upstream raw material liquid ammonia has slightly declined. As of the 26th, the price quoted by manufacturers in the northern region has maintained in the range of 3000-3400 yuan/ton, while that in the northwest region is around 290-3000 yuan/ton. The declining price trend of cruise raw materials has a negative impact on the ammonium nitrate market, and the price trend of ammonium nitrate Market is temporarily stable. At the end of the peak season of the downstream civil explosion industry recently, the demand for ammonium nitrate has weakened and the stocks of ammonium nitrate manufacturers have increased, but the liquid ammonia market is on the rise again. The ammonium nitrate Market is shaking at a low level because of the bad market. Ammonium nitrate analysts believe that the recent upstream raw material market price shocks, but the downstream demand is not good, ammonium nitrate market prices are expected to maintain shocks in the later period.

On June 25, the ammonium nitrate commodity index was 103.51, which was the same as yesterday. It was 12.59% lower than the cyclical peak of 118.42 points (2019-01-15), and 33.79% higher than the lowest point of 77.37 on October 31, 2016. (Note: Period refers to 2013-02-01 to date).

Recently, the price trend of domestic ammonium nitrate Market is temporarily stable. Affected by environmental protection control, domestic ammonium nitrate plant shuts down more, domestic ammonium nitrate plant starts less, but with the warming of the weather recently, the influence of northern air limitation disappears. In addition, due to the complete shutdown of domestic downstream civil explosion industry, domestic ammonium nitrate manufacturers have more stockpiles, and the price trend in the field declines. As of the 25th day, the domestic ammonium nitrate market price negotiations in 1900-2050 yuan/ton, affected by environmental protection, so now many manufacturers in many areas are forced to limit production or stop production and maintenance for environmental protection inspection, the price trend of ammonium nitrate on the site is temporarily stable.

Recently, the domestic nitric acid price has risen, up to the 25th, the market price is 1800 yuan/ton. The rising trend of nitric acid price has a positive impact on the ammonium nitrate market, and the price trend of ammonium nitrate is stable. The price trend of liquid ammonia in upstream raw materials has slightly declined. As of the 24th, the price of manufacturer in the northern region has maintained in the range of 3000-3400 yuan/ton, while that in the northwest region is above 290-3000 yuan/ton. The declining price trend of cruise raw materials has a negative impact on the ammonium nitrate market, and the price trend of ammonium nitrate Market is temporarily stable. At the end of the peak season of the downstream civil explosion industry recently, the demand for ammonium nitrate has weakened and the stocks of ammonium nitrate manufacturers have increased, but the liquid ammonia market is on the rise again. The ammonium nitrate Market is shaking at a low level because of the bad market. Ammonium nitrate analysts believe that the recent upstream raw material market price shocks, but the downstream demand is not good, ammonium nitrate market prices are expected to maintain shocks in the later period.

On June 24, the PX Commodity Index was 58.40, unchanged from yesterday, down 42.97% from its peak of 102.40 points in the cycle (2013-02-28), and up 28.21% from its low of 45.55 points on February 15, 2016. (Note: Period refers to 2013-02-01 to date).

According to statistics, the domestic market price trend of p-xylene was temporarily stable on the 24th. Pengzhou Petrochemical Plant operated steadily in the field. Urumqi Petrochemical Plant started 50% of its operation, Fuhai Created Aromatic Hydrocarbon Plant started a line, CNOOC Huizhou Refinery and Chemical Plant overhauled, Hengli Petrochemical PX Plant put into operation, and other units operated steadily temporarily. Due to the normal supply of p-xylene in the domestic market when the new unit was put into operation, p-bis The price trend of toluene market is stable for the time being. The opening rate of PX plant in Asia is about 80%. On June 21, the closing price of p-xylene in Asia increased by 11.5 US dollars/ton. The closing price is 806.5-808.5 US dollars/ton FOB in Korea and 825.5-827.5 US dollars/ton CFR in China. More than 50% of the domestic units need to be imported. The rising price of foreign units has a certain positive impact on the domestic market price of p-xylene. The price trend of p-xylene in Asia is temporarily stable. 

On June 21, the price of WTI crude oil in August rose to 57.43 U.S. dollars per barrel, an increase of 0.36 U.S. dollars. Brent crude oil in August rose to 65.20 U.S. dollars per barrel, an increase of 0.75 U.S. dollars. Crude oil price trend rose, which has a cost supporting role for the price of downstream petrochemical products, while the price trend of paraxylene market is temporarily stable. Recently, the textile industry has been stabilizing, PTA price has been stabilizing for 24 days. The average offer price in East China is raised near 6000-6100 yuan/ton. As of the 21st day, the domestic PTA start-up rate is about 93.5%, the polyester industry start-up rate is about 88.9%, and the downstream production and sales rate remains high. However, PTA market price shocks, and PX market price is expected to be low in the later period.