Shen Wan Hongyuan: Low season combined costs weaken, terminal inventory switched to storage, basic chemical price spreads weaken, Q3 industry profits are under seasonal pressure

The Zhitong Finance App learned that Shen Wan Hongyuan published a research report saying that the traditional low season for basic chemicals during the 24Q3 low season combined with weakening energy costs, dragged down downstream demand for inventory replenishment, and the price spread for basic chemicals gradually weakened. Currently, domestic chemical demand is bottoming out due to increased policies, and external demand continues to be fulfilled in the context of a “soft landing”. The traditional cycle focuses on Hakuba and the alpha of the industry segment (export chain priority); supply in the spandex industry is peaking, and the trend of clearing capacity is remarkable; the increase in phosphate ore production capacity falls short of expectations, and demand to support new energy sources is growing faster, and supply and demand are tight; the concentration of the explosion industry is compounded by the increase in mining capital expenditure, and the boom continues to improve; the growth segment focuses on the electronic materials and materials industry chain, where the domestic renewable energy autonomous and controllable process is accelerating. Relevant areas will be definitively fixed.

The 2024Q3 traditional off-season for chemicals arrived, the oil and gas boom declined, coal prices fluctuated, and terminal depots dragged down chemical profits on a month-on-month basis. The traditional low season for chemicals in the third quarter, and oil and gas prices weakened at the same time, causing some terminals to maintain a state of active storage removal, and demand fell from a high level. According to Wind statistics, the average spot price of 24Q3Brent was 80.5 US dollars/barrel, down 7.4% and 5.5%, respectively; the average price of NYMEX natural gas futures in Q3 was 2.24 US dollars/million British thermal heat, down 16% and 3.4%, respectively; the Q3 price of 5,500 kcal thermal coal in Q3 at Qinhuangdao Port was 854 yuan/ton, down 2.2% and 0.4%, respectively. Energy costs fell month-on-month in the third quarter, compounded by the traditional low season. Downstream was basically in a state of active storage removal, and terminal demand was weak. According to the profit forecast of the 2024 three-quarter report of mainstream chemical companies tracked by Shenwan Hongyuan, the weighted average EPS for the first three quarters of 2024 is expected to be 0.68 yuan, up 8.4% year on year. Among them, the Q3 weighted average EPS is 0.23 yuan, up 14.9% year on year and 10.6% month on month. The major year-on-year increase in net profit in the first three quarters of 2024 is mainly phosphorus compound fertilizer, phosphate chemicals and nitrogen fertilizer, vitamins, spandex, fluorochemicals, tires, titanium dioxide, explosives, semiconductor and packaging materials companies, etc. Among them, the sub-industries with significant month-on-month improvements in Q3 are mainly phosphorus compounds and phosphorous chemicals, tires, semiconductors and packaging materials, and some fine chemical companies.

Baima's standard: the Q3 petrochemical price spread declined, and MDI plant maintenance affected the commencement of construction. Wanhua Chemical's 2024Q1-3 is estimated to be 11,974 billion yuan (YoY -6%, referring to parent net profit, same below), of which Q3 is 3.8 billion yuan (YoY -8%, QoQ -5%); weak terminal demand, narrowing oil and coal price spreads, and coal chemical companies are under month-on-month pressure. It is estimated that Hualu Hengsheng 2024Q1-3 will be 3,024 billion yuan (YoY +3%), of which Q3 will be 82.4 billion yuan (YoY +3%) QoQ -31%); Lucy Chemical 2024Q1-3 is 1,621 billion yuan (YoY +220%), of which Q3 is 450 million yuan (YoY +44%, QoQ -25%); Baofeng Energy 2024Q1-3 is 4.855 billion yuan (YoY +25%), of which Q3 is 1.55 billion yuan (YoY -5%, QoQ -18%); spandex bottoms fluctuate, leading companies have a strong scale advantage. Huafeng Chemical 2024Q1-3 is 2,068 billion yuan (YoY +7%), of which Q3 is 550 million yuan (YoY -4%, QoQ) -34%) ; Xinxiang Chemical Fiber 2024Q1-3 was 211 million yuan (YoY +779%), of which Q3 was 60 million yuan (YoY +400%, QoQ -33%); new phosphate ore production capacity is progressing slowly, and the economy remains high. Yuntianhua 2024Q1-3 is expected to be 4.421 billion yuan (YoY +19%), of which Q3 is 1.58 billion yuan (YoY +54%, QoQ +14%); Chuanheng Shares 2024Q1-3 is 654 million yuan (YoY +33%), of which Q3 is 654 million yuan (YoY +33%) YoY +38%, QoQ+ 37%); Xingfa Group 2024Q1-3 was 1.355 billion yuan (YoY +45%), of which Q3 was 550 million yuan (YoY +69%, QoQ +30%);

Fluorine chemical targets: The quota system is implemented as scheduled, with strong supply side support, and the refrigerant boom continues to rise. It is estimated that Juhua 2024Q1-3 will be 1,364 billion yuan (YoY +83%), of which Q3 will be 530 million yuan (YoY +106%, QoQ +1%); Sanmei 2024Q1-3 will be 634 million yuan (YoY +166%), of which Q3 is 250 million yuan (YoY +131%, QoQ +9%); Yonghe 2024Q1-3 will be 178 million yuan (YoY10) %), of which Q3 was $65 million (YoY +25%, QoQ -13%). The raw material fluorite was affected by the review of the main production area, and mining operations were blocked, but weak Q3 terminals dragged down the boom. Jinshi Resources is expected to be 253 million yuan (YoY +3%) in 2024 Q1-3, of which Q3 is 85 million yuan (YoY -29%, QoQ -21%).

Tire targets: Strong demand for orders and production schedules. Although cost pressure increased in Q3, the overall impact was limited. Sailun Tire 2024Q1-3 is expected to be 3.245 billion yuan (YoY +60%), of which Q3 is 1,094 billion yuan (YoY +12%, QoQ -2%); Mori Kirin 2024Q1-3 is 1,757 billion yuan (YoY +77%), of which Q3 is 680 million yuan (YoY +76%, QoQ +18%); Linglong Tire 2024Q1 -3 was 1.7 billion yuan (YoY +77%), of which Q3 was 775 million yuan (YoY +94%, QoQ +60%); Guizhou Tire 2024Q1-3 was 627 million yuan (YoY 0%), of which Q3 was 200 million yuan (YoY -31%, QoQ -9%); GM 2024Q1-3 was 437 million yuan (YoY +175%), of which Q3 was 150 million yuan (YoY +49%, QoQ +12%); Triangle Tire 2024 billion yuan Q1-3 was 9.129.12 (YoY), -14% (YoY), -14% Of these, Q3 is 300 million yuan (YoY -33%, QoQ -6%); Chuecheng Huatai 2024Q1-3 was 397 million yuan (YoY +30%), of which Q3 was 135 million yuan (YoY +19%, QoQ -4%); Hailide 2024Q1-3 was 290 million yuan (YoY +7%), of which Q3 was 100 million yuan (YoY 0%, QoQ -13%); Yanggu Huatai 2024Q1-3 was 194 million yuan (YoY -25%), of which Q3 was 55 million yuan (YoY +10%, QoQ) -5%)

Cyclical products sector: Under the traditional off-season, the boom in some products continues to decline. Soda ash: Yuanxing Energy 2024Q1-3 is expected to be 1,659 million yuan (YoY +10%), of which Q3 is 450 million yuan (YoY -1%, QoQ -30%); Sanyou Chemical 2024Q1-3 is 428 million yuan (YoY +23%), of which Q3 is 100 million yuan (YoY -48%, QoQ -60%); China Salt Chemical 2024Q1-3 is 541 million yuan (YoY -34%), of which Q3 is expected to be 100 million yuan (YoY +35%, QoQ -74%); Lake Co., Ltd. is 2024Q1-3 3,512 billion yuan (YoY -37%), of which Q3 is 1.3 billion yuan (YoY +159%, QoQ +2%); Zangge Mining 2024Q1-3 is 1,847 billion yuan (YoY -38%), of which Q3 is 550 million yuan (YoY -42%, QoQ -28%); Potassium International 2024Q1-3 is 410 million yuan (YoY -59%), of which Q3 is 140 million yuan (YoY -50%, QoQ -26%); Pesticides: Yangnong Chemical 2024Q9.3 is expected to be 9.8.3 billion yuan 100 million yuan (YoY -28% ), of which Q3 was 220 million yuan (YoY -7%, QoQ -34%); Runfeng 2024Q1-3 was 362 million yuan (YoY -50%), of which Q3 was 180 million yuan (YoY -39%, QoQ +521%); Civilian Explosion: Yipuli 2024Q1-3 was 551 million yuan (YoY +16%), of which Q3 was 200 million yuan (YoY +18%, QoQ -7%); Guangdong Hongda 2024Q1-3 was 713 million yuan (YoY +43%), of which Q3 was 713 million yuan (YoY +43%) 300 million yuan (YoY +69%, QoQ -11%).

In the field of new materials: Domestic autonomous and controllable processes are accelerating, and domestic alternative materials companies continue to expand. Localization of the domestic semiconductor industry is progressing steadily, and downstream capital support continues. Yaktech 2024Q1-3 is expected to be 750 million yuan (YoY +56%), of which Q3 is 230 million yuan (YoY +65%, QoQ -16%); new energy materials: Xinzhoubang 2024Q1-3 is expected to be 691 million yuan (YoY -13%), of which Q3 is 275 million yuan (YoY -2%, QoQ +10%); Taihe Xincai 2024Q1-3 is 142 million yuan (YoY -49%), of which Q3 is 142 million yuan (YoY -49%) (YoY -60%, QoQ -73%); Xinhua Biotech 2024Q1-3 was 180 million yuan (YoY -12%), of which Q3 was 0.3 billion yuan (YoY -50%, QoQ -54%); biomaterials: Huaheng Biotech 2024Q1-3 was 225 million yuan (YoY -30%), of which Q3 was 75 billion yuan (YoY -42%, QoQ +19%); Meihua Biotech 2024Q1-3 was 2.154 billion yuan (YoY 0%), of which Q3 was 680 million yuan (YoY -14%) -6%); blue Xiaotech 2024Q1-3 was 654 million yuan (YoY +26%), of which Q3 was 250 million yuan (YoY +45%, QoQ +6%); China Porcelain Materials 2024Q1-3 was 490 million yuan (YoY +11%), of which Q3 was 160 million yuan (YoY +31%, QoQ -19%); Lubricants and plastic additives: Ruifeng New Materials 2024Q1-3 was 494 million yuan (YoY +10%), of which Q3 was 175 million yuan (YoY -13%, QoQ +5%); 2024Q1-3 330 million yuan (YoY +17%), of which Q3 is 110 million yuan (YoY +10%, QoQ -3%); Chenghe Technology 2024Q1-3 is 198 million yuan (YoY +18%), of which Q3 is 70 million yuan (YoY +19%, QoQ +6%); food and feed additives: Jinhe Industrial's 2024Q1-3 is expected to be 357 million yuan (yoY-%), of which Q is 100 million yuan (yoY%, QoQ-%); Xinhe Chengcheng Q-1 is. (YoY+%) Q = 100 million yuan (YoY+%, QoQ +%).

Core hypothetical risks: 1) The progress of new industry projects falls short of expectations; 2) Prices of some chemical products have dropped sharply due to blocked exports.