2021 glass fiber price rise may continue
From the middle of January to the end of March 2020, the epidemic situation was tight at home and loose at home, and exports were strong. Under the guidance of foreign demand, the global demand and supply were relatively stable. After April, the domestic epidemic situation was basically under control. Driven by infrastructure construction and wind power, the demand for glass fiber became popular, and the demand for automobile and electronic appliances picked up in the second half of the year, driving the continuous development of domestic demand. Therefore, the inventory of domestic glass fiber enterprises has continued since the Spring Festival.
In the first quarter of 2020, although the domestic epidemic situation is relatively severe, the supply side shrinks first: from the third quarter of 2019 to the first quarter of 2020, Jushi Chengdu three lines total 230000 tons and Taishan glass fiber three lines total 120000 tons. Due to the relocation and shutdown first, Chongqing Sanlei and other new enterprises have no plans to put into operation. However, in the second quarter of 2020, with the recovery of domestic demand, leading enterprises move to land Continued production: 150000 tons of jushitongxiang intelligent manufacturing second line, 130000 tons of Chengdu relocation intelligent manufacturing first line and 120000 tons of Chengdu relocation intelligent manufacturing second line will be ignited and put into production in June, July and September 2020 respectively; 100000 tons of Taishan glass fiber new line will be ignited and put into production in May. In addition, Shandong glass fiber 3 to 80000 tons line will be put into operation in May 2020. Overseas, some production lines of OC, PD, neg and other leading enterprises affected by the epidemic stopped production or limited production, with a total of about 300000 tons.
Affected by the epidemic situation in the first quarter of 2020, the price of glass fiber is still hovering at the bottom. However, in the second quarter, the demand for glass fiber has improved, and the price of some varieties such as glass fiber composite yarn and felt yarn has increased by 100-200 yuan / ton. Since September, the overall trend price increase of glass fiber has started: the price of new domestic orders has increased by 7% in September, while the price of all new orders has increased by 10% in October, and the price of electronic cloth has also started to rise, with a pace and strength exceeding market expectations. It is considered that under the production line of 120000 tons of Jushi Chengdu and 100000 tons of Jinniu, the probability of glass fiber price rising again in the fourth quarter is not big, but the price of some rare varieties will continue to push up, so the average price center of glass fiber will continue to move up. With the price increase from September to October in place, it is expected that the elastic contribution of glass fiber price increase to the performance will show in the fourth quarter of 2020.
The production line will be put into operation in 2021. Xingtai Jinniu's two 100000 ton production lines will be put into operation in the first quarter of 2021 and the fourth quarter of 2021 respectively; Changhai's 100000 ton production line will be put into operation in July 2021 (Tianma's 30000 ton production line will be cold repaired); Jushi's 150000 ton Tongxiang intelligent manufacturing line 3 will be put into operation in the third quarter of 2021, but it is estimated that Jushi Egypt's 80000 ton production line will be shut down for cold repair in the first half of 2021 From the second quarter to the third quarter of 2021, the second phase of Tongxiang intelligent manufacturing 60000 tons of electronic yarn was ignited and put into production. If spinning is included, on the whole, the supply side capacity will increase by 400000 tons in 2021, significantly less than the new capacity in 2017-2020.
On the demand side, automobile, electronic and electrical appliances and overseas demand will be the decisive recovery track, while the demand rate of real estate, infrastructure and wind power will be resilient.
Therefore, it is expected that the volume and price of glass fiber will continue to rise in 2021, and the performance of leading enterprises is expected to continue to exceed market expectations.
From the perspective of core assets, it is by no means a simple cycle. Glass fiber has a similar industry perspective with MDI, automotive glass and silicon chip industry. The core financial indicators of glass fiber leader China Jushi are comparable to those of Wanhua chemical, Fuyao Glass and Longji Co., Ltd., and they all export high-quality differentiated products and services at the most advantageous cost of the industry, and start the global growth road. They are all core assets.
Demand logic is established, and price increase drives performance elasticity. The breakthrough progress of vaccine dispels the market's doubts about overseas economic recovery, and the export of glass fiber is expected to improve significantly in 2021. The demand for automobiles, electronics and electrical appliances will be a certain recovery track, and real estate, infrastructure, wind power and so on may continue to be resilient. The demand rate in 2021 will be better than this year, while the overall increment of the supply side next year will be limited, and the two-way optimization of supply and demand is expected to continue to drive the price elasticity of glass fiber Sex. In fact, the price of glass fiber roving has increased by 7% and 10% respectively in September and October 2020, and the price of electronic yarn has also increased in October. The company's performance elasticity will initially appear in the fourth quarter of 2020, and the volume price elasticity of glass fiber is expected to continue to exceed expectations in 2021.
Sinoma technology's glass fiber: the elasticity of volume and price is more than expected. It is estimated that the company's glass fiber sales volume exceeded 300000 tons in the third quarter, reaching a historical quarterly peak; at the price level, under the strong domestic demand, the company raised the price of 300 yuan / ton for new domestic orders on September 1, and raised the price of 500-800 yuan / ton for different types of roving at the end of September, and 200-500 yuan / ton for different specifications of electronic yarn at the beginning of October. It is expected that strong demand will continue from the fourth quarter to next year, and the rise of glass fiber volume and price will continue to drive the company's performance elasticity.
Sinoma's glass fiber blades: there is no risk of cliff like decline in wind turbine blade demand in 2021. Under the "rush loading effect" from 2019 to 2020, the company's blade supply falls short of demand. Therefore, the company may give priority to supply medium and long-term order customers, so as to ensure stable blade operation in 2021. It is judged that under the background of the 14th five year plan, as a priority variety of new energy, the annual installed capacity of wind power is expected to rise significantly compared with that of the 13th five year plan, and the demand curve is moving up for a long period.
Glass fiber diaphragm of Sinoma Technology: high quality growth period starts. The company has realized that some Japanese and Korean customers have achieved batch supply, and the overseas revenue has accounted for 15% in the first half of 2020. The company's new product R & D is progressing smoothly (the company's 7 μ m wet diaphragm has taken the lead in realizing mass production and sales in the industry, leading the market, and the 5 μ m diaphragm has been successfully developed, which is on the eve of batch supply). The production capacity is basically saturated before the new production line is put into operation, and it is estimated that the second half of 2020 In the third quarter, the company has turned losses into profits. It is estimated that in the middle of 2021, the total capacity of the company will exceed 1.5 billion square meters (about 960 million square meters at present), the bottleneck of the company's capacity will be broken, and the profitability is expected to continue to climb.
In short, the glass fiber industry is expected to copy the supply optimization path of cement and glass, and China Jushi and Sinoma technology will continue to lead the glass fiber industry with its strong product and cost advantages.