The data shows that as of August 31, the spot price of float glass in major cities across the country was 1869.87 yuan / ton, with a cumulative increase of 18.71% in August, hitting a new high since late December 2010.
The hot market is also reflected in the futures market. Since late July, the main domestic glass futures contract (currently Glass 2101) has continuously refreshed historical records, reaching a maximum of 1,968 yuan/ton. In July and August, the cumulative increase of the main glass futures contracts was 14.48% and 10.21% respectively.
In the glass industry, there is a saying of "golden nine and silver ten", that is, September and October of each year are the peak sales seasons for glass. This year, the peak sales season for glass has been brought forward to July and August. On the demand side, the real estate market is the main source of demand for the glass industry, and the concentrated downstream construction has increased the demand for glass ahead of schedule; on the supply side, the "Implementation Measures for Capacity Replacement in the Cement Glass Industry" implemented in January 2018 restricts the new production capacity of the glass industry, and glass companies only Production can be carried out with stock production lines.
Zhang Chi, chief researcher of energy and chemical commodities of Guotai Junan Futures, said that the mismatch between supply and demand is the main reason for the sharp rise in glass prices. Previously, due to the impact of the epidemic, the demand for glass was greatly reduced, and the industry's production capacity was therefore reduced. Glass prices continue to strengthen as the real estate market recovers steadily and the supply side struggles to keep up with the substantially increased demand.
The price of float glass continued to rise, increasing the production cost of downstream glass processing enterprises. CSG A recently stated on the interactive website that due to the rise in the price of the original float glass, the company decided to adjust the product price appropriately. Xiuqiang, which is mainly engaged in glass deep processing business, said that raw glass is the main raw material required for glass deep processing products. If the price of raw glass rises, this change cannot be transferred to the sales price of the product in time, and the company's profits will be affected.
Chen Yi, senior analyst of glass futures at the Zhengzhou Commodity Exchange, said that higher glass spot prices will increase the pressure on downstream processing companies. Recently, the resistance of some glass processing enterprises to high prices has heated up. If the price continues to rise, the outbound speed of glass manufacturers will slow down. "In September and October, glass demand is expected to decrease rapidly to a lower level, and glass prices will see a sharp correction."
For the market outlook, some industry insiders believe that as prices are at historically high levels, a correction is likely to occur in the short term. However, there are still many people in the industry who are optimistic about medium and long-term glass prices.
Cui Yuping, a glass analyst at Zhuochuang Information, said that at present, the mid-stream and downstream manufacturers have relatively sufficient stocks, and the market will enter the stage of destocking in the short term. It is expected that the float glass factory will control the pace of price increases in the future, but under the support of factors such as low inventory and good rigid demand, there is no need to worry too much about the price correction.
"At present, the first stage of the peak season for glass demand is basically over. It is expected to usher in a rest period in September, and the spot price may be weak and fluctuating." Zhang Chi judged that in the medium and long term, the driving force for the rise of glass spot still exists. Glass prices only have valuation adjustments, not driven down. Therefore, it is optimistic that glass prices will rise further in the fourth quarter.
- Transferred from Xinglass.com
