Upstream output this year end under the dual role of the weather and the price elasticity of supply amplifier, producing the contradiction between supply and demand of lack of raw materials and finished products are moderate. This year, the downstream has performed better than expected, investment and policy stimulus at the same time, vehicle and tire industry welcomed encouraging growth. Rubber (20240, 285.00, 1.43%) industry in the 5 years bear market, a rare state of tight balance between supply and demand. Periodic supply curve shift to the left and the demand curve moves to the right, the growth of rebalancing mutual switch triggered industry, the main line throughout the course of the 2016 most direct embodiment is to reduce global inventories. Speculative funds also take this opportunity to hype, enlarge the industry of contradictions, rubber prices rebounded sharply 10925 yuan/ton, up 113.68%.

Setting since the middle of next year before the orders are stable, so the enterprise exists in the middle of circulation and fill in anticipation of a raw material inventory to the spot price form a strong support. In addition, the bear market in the process of a large number of traders in middle reservoirs shrink, which reduces the industrial chain of flexibility. Accused of disk capacity further upstream, rised in tight raw material under the condition of the finished product to lift the spot price will obviously. This cut for the second quarter of next year, create uncertainty, out of stock or once again become a hype, glue price high innovation space. Throughout these rubber support price of supply and demand factors, weakening the risks to start the second half of next year. After el nino and la Nina, the region a large probability the weather will be good this year, then according to the open cut area is calculated, and the supply will return into the general upward trend. Policy stimulus to boost car this year, next year after overdraw consumption growth will fell, new demand is relatively scarce. In addition, after the July of the previous period will also turn into high inventories of recirculation, the fundamentals of multiple pressure prices could turn weak pattern, form throughout the year after magnified form first, ranges between 15000-25000.

A, review

Glue as 2016.12.20 Shanghai index up to 20535 this year, the lowest 9610, to 19110, rising from 8305 points, or 76.9%. Clinch a deal the 24.469 million hands, holdings of 346000 hands. In 2016, Shanghai rubber prices overall is given priority to with shock upside, rhythm can be divided into four stages:

First stage: from natural rubber seasonal cycle, each year in 2-4 month supply of season, both at home and abroad to produce rubber limited area cut to stop the glue output, supply shortage gives the market bullish end support. And compared to the supply of the downturn, at the same time I just need a strong recovery; In addition was lit market funds after the Spring Festival to do more enthusiasm, black lead up under the stimulus of natural rubber market also opens a long-lost "bull market".

Authorities after the speech, the second stage: may risk appetite, commodity market capital of Shanghai rubber prices down; Combined with the major producer in the rainy season, early drought relief, rapid increases in raw material supply rubber price decline by more than 20%; At the same time, I was after previous high start, finished goods inventory is slow, thereby slowing demand for raw materials, start setting part into a slowing trend.

In the first half of the third stage: el nino after drought relief, la Nina fell in rainy weather. This region and rainfall of rainy season was obviously higher than that of the same level. This year the global open cut area continues to grow, but due to the poor weather conditions affect the tapping frequency, resulting in a decline in yield and production release. In addition, July through September deliveries or 09 stress concentration release the important stage of the huge amount of the warehouse receipt to suppress, leading to 1609 again below ten thousand yuan. Other distant months under the background of the temporarily not prominent contradiction between supply and demand to maintain shocks form.

The fourth stage: in addition to supply less than expected, the downstream demand in the boom of investment and policy driven also rose sharply, cars and tires to maintain high growth, production and sales for a long time in a tight balance between supply and demand in the peak industry. In 09 contract problem solving only after the market pessimism, 11 issue of plasmodium vivax glue first breakthrough upside, then Shanghai glue in domestic goods rising speculative atmosphere also hit the twenty thousand mark up all the way.

A, industrial structure analysis

1, the dual influence of el nino and la Nina yield decreased production throughout the year

Rubber output end as have obvious seasonal characteristics of agricultural products, and domestic and Thailand region due to the latitude differences also exist in the corresponding time. After foreign region this year to open cut successively appeared dry and rainy weather, made in the case of open cut area is slightly increased, accumulated compared to the real output and no big changes. ANRPC glue production data showed that the first 11 months of day rose 0.4% to 10.106 million tonnes. Including Thailand, Vietnam, India, year-on-year growth of 1.3%, 4.8% and 7.4%, respectively; China, Malaysia, maintain downturn, with China decline of 5%. Export (including export to China of composite glue, mix glue), November 1 -, year-on-year growth of 4.9% in Thailand, Vietnam, Cambodia have double-digit growth; Indonesia, Malaysia day glue export of varying degrees of decline. Despite the bad weather, but due to the increase in overall open cutting area, day glue production or will be increased; And consumption to grow by 4% year-on-year, imports edged down 1.4% year-on-year.

Domestic production areas, months, 2016 glue production are the lowest in nearly four years. Rainfall this year not only continuous rainfall days long and big, hainan region multiple occurrences of torrential rain and typhoon weather, yunnan region it is almost 2 months of continuous rain, even though the rainy season rainfall in the region is not surprising that, but this year the situation has seriously affected the tapping operations. In addition, before September because the rubber price is low, rubber farmers tapping enthusiasm is not high, abandon the GeQi phenomenon is still obvious. Around the plant capacity and production profit, low capacity utilization will increase the cost of processing. In the case of raw material supply tight, processing plant for common materials. Region in September after a long rainy season, in the fourth quarter output recovered somewhat, but fate is still not out of production as a whole. The current domestic production basic stop cutting, factory processing only a small amount of imported raw materials.

Thailand production areas, the weather also not optimistic this year by the double impact of el nino and la Nina, cut open after drought and subsequent rainy weather made of natural rubber production has been hovering between production and the tiny drop slightly. South as the main production of natural rubber in Thailand, the planting area accounts for about 63% of the total acreage of Thailand, From the perspective of the statistics of rainfall, rainfall after more in August. Raw material volume is increased slowly, but factories can be stable level. Thailand now starts between 6 to 8 into a consortium, including latex starts in 5 into left and right sides, glue starts 7-8, a few plant can maintain 6-7 smoke piece of rubber production, capacity utilization according to the contract completion starts to adjustments. Late downstream factory purchasing conditions, weather conditions, raw material production and sales, shipping date arrangement is the main factors influencing the factories. The whole label adhesive production this year is expected to be flat or slightly beyond the level of last year, latex production or the basic flat with last year, smoke piece of rubber production or would continue to decline slightly. At present about basic long before the Spring Festival has been booked, as we have learned this year giant 50% - 60% for long, long estimates a steady increase. Factory management pattern also some changes have taken place in this year, the number of contracts directly to the factory and large traders on the rise, small and medium-sized traders quantity decreased significantly. Raw material is still at the end of the most abundant period, is expected to natural rubber production still can maintain a small growth this year. Next year and gradually weaken the influence of la Nina, producing the weather to improve the probability of large, then under the background of open cut area is growing steadily, global day glue production is expected to improve.

Trade with China close to produce adhesive power, in addition to Thailand, Vietnam and rapid rise in recent years, and from tree growing area and that this will be the long-term trend. Vietnam after the financial crisis is insufficient production of 700000 tons/year, rising to $2015 by 1.01 million tonnes (one million tons) for the first time, the growth of 53%. With the stable development of the Vietnamese natural rubber industry in 2016, the overall level of output is expected to reach 1.05 million tons, hit a record high. Vietnam is now ranks the world's third largest rubber production.

According to the seasonal characteristics of rubber production, after the global supply of peak in February will enter stop cutting period, 3 to 5 month production areas, basic no new materials factory general early reserves of raw materials inventory for processing production. At this stage for vulnerable period of rubber industry chain, due to the lack of the spot, and as a result of lost aggregate enterprise in the bear market, market concentration increasingly concentrated, prone to stop cutting period phenomenon of hype, cause gum prices artificially high. The current global stocks fell, reservoir elastic effect is reduced, the second quarter of next year or will glue price high for years. The output increase after June, supply pressure to suppress glue price formation.

2, investment and policy have power car sales than expected

And black industry chain supply side trigger price reform logic, natural rubber is all the way up this year, the downstream demand than expected growth is one of the fundamental key. In 2016, is China's auto market stranger "policy". On October 1, 2015 began to implement the displacement below 1.6 L and vehicle purchase tax halve policy, expires on December 31, the Chinese market once again topped the world's largest single market. November 1 - passenger car production and sales in 21.7433 million and 21.6781 million, up 15.56% and 15.57%; Commercial vehicle production and sales of 3.2836 million and 3.2699 million, up 6.31% and 5.30%. Did not in fact such high growth for the first time, a series of subsidy policy, China's auto market explosive growth in more than four years. In 2011, five years ago because of good policy to the paragraph, the market has dropped sharply in the year-on-year growth, China's auto market has entered the later return swaps nearly five years.

Overall, purchase tax halve policy really like previous stimulus spending, has played a very important role of the automobile consumption. Recently the state council for approval since January 1, 2017 to December 31, the purchase of 1.6 liters and displacement of passenger cars under the vehicle purchase tax shall be levied at a reduced rate of 7.5%. Since January 1, 2018, back in accordance with the vehicle purchase tax is imposed by the statutory tax rate of 10%. Although not very specific to predict how much tax preferential policy decline tax cuts can affect the industry sales, but at least in after a quarter or two quarters have a major negative impact to the industry sales. Since 16 years under the policy stimulus displacement below 1.6 L have more passenger car overdraft, 2017 passenger car sales growth is expected to by double-digit down to single digits.

From various types of car production and sales data, heavy truck production and sales data to become one of the most bright eye. Heavy card is the main terminal of tire demand, is also the most important natural rubber industry downstream. Heavy card sales in November 88000 the all-time highest level, in the same period last year compared to 46700 cars soared 88%, refresh the heavy card sales record in November. 1 - in November 650000 China heavy card market combined pin chariots, year-on-year growth of 31%, annual sales are expected to reach about 750000 vehicles. Push heavy card market so the main reason for the rapid development and policy to promote and update demand release are inseparable. First, the second half of 2016 to the management of transport vehicle "overrun overload" new rules to make the total weight of 6 x 2 tractor from 55 tons fell to 46 tons, bicycle capacity by 10% - 20% generally, attract a lot of heavy card users to change or new vehicles to meet the demand of capacity of gap, become a catalyst driving demand higher. Secondly, in terms of infrastructure investment, around the PPP projects, subway, airport, railway and highway construction is also a large scale, great efforts to promote infrastructure investment and heavy card sales have a certain role in promoting. In addition, look from the long term, heavy card sales fluctuation and correlation is very high, the growth of the M2 money supply factors to investment level there is a certain time lag, so heavy card than M2 has 3-6 months lag. Heavy card can sustain the high growth over a long period of time this year, the first half is driven by the M2 the industry into the business cycle, and the second is the policy level of positive affect the formation of thick tail. The M2 has turned head down, and this year's policy will overdraw negative effect on the formation of market next year, so heavy card sales growth falling to a big probability event next year, will only by bringing to the market infrastructure smooth factor.

3, tire orders stable production cycle

Tire enterprise starts to present positive in 2016, 2015 in production not to continue in 2016. Article before November, 625 million, up 14.89% from a year earlier. New growth is not the industry consolidation to suspend, but in the industry production enterprises exist in the actual production capacity increased. It is understood that the production capacity of ascension is based on the outlet pressure moved above and accessory market demand. Another meridian tyre change upgrades in recent years is also got positive.

Concrete, November 1, 2016 in shandong district all-steel tire was operating at 65.27%, up 3% from a year earlier; Domestic semisteel tire was operating at 69.45%, was up 2.8% over the same period last year. In 2016, in addition to the influence of 1 to 2 months for the lunar New Year holiday, the rest of the month starts all presents positive compared to the same state, the rally in the latter half of the relative strength, especially in the fourth quarter starts to rise trend is still strong.

This year China's tire industry not like most people expected in bankruptcy last year, but in the industry's positive adjustment of steady order. On production in our country is at the beginning of the United States, passenger car tires "double reverse" survey, tire exports in the second half of the decline is obvious. Car production and sales increased significantly, but the domestic market and the regulations on highway transfinite transport vehicle is strictly enforced, tyre demand increased slightly. In addition, tire companies are no longer blind pursuit of capacity expansion, but positive for structural adjustment of production capacity, product upgrading, product promotion, such as work, all-steel tire starts good stability, small growth, yield and in raw material prices rebound in the ground up. This year industry development presents the following main features:

1), imports of all-steel tire meet the "double reverse", to the United States since June drop tire exports

On January 29, 2016, the united steelworkers (USW) apply to the U.S. Commerce Department and the United States international trade commission, the requirement for truck and bus tyre products from China launched anti-dumping and anti-subsidy investigation. Affected, the export of Chinese tires focus ahead of time, combined with China tire enterprises to other markets, exports of 40112000 in 1-5 months year-on-year growth of 10%, including tires for more than 20%. June the preliminary decided that truck and bus tire imports from China subsidies, subsidies range from 17.06% to 23.38%, thus a corresponding margin, cause the tires. Because of other countries in the development of the market is good, even if the U.S. market, exports fell, compared with the first 10 months of total exports are still rising. 1 - October's total exports of 2.72399 million tons, compared with the same period last year growth of 5.23%.

2), the recovery and cure policy, driven by commercial vehicle doing well

In the context of the overall economic recovery this year, demand for materials such as coal and steel production in the society continues to grow, highway logistics increase slightly, in addition to real estate investment in fixed assets rose for all steel tire industry has brought some positive, but the most worthy of our attention is brought by the automobile policy dividends. In recent years, commercial vehicle plagued by overcapacity, production and marketing has been in a pessimistic dip. In August 2016, however, the ministry of communications, the national development and reform commission, the ministry, the ministry of public security, general administration of quality supervision, inspection and quarantine departments jointly established the regulation violation overrun overload highway truck special operation plan, for super prompting the implementation of the logistics enterprises to accelerate the upgrading of the New Deal not compliance transport vehicles, cause years new car to purchase demand to rise significantly. Entered since 2016, commercial vehicle growth from negative to positive, especially the rapid growth of the heavy card data compelling, form a complete set of all-steel tire demand began to recover quickly.

3), raw materials rose sharply, tire prices go up

Market supply and demand balance improved, 2016 tyres work is good, but the pressure from the cost of raw materials is increasing. Years tire raw materials prices rebounded sharply after the bottom of the all-steel tire cost pressure, domestic all-steel tire prices also fell to a pattern, factory stabilizing agent. As of December day glue end of December, up 61.73% year on year, butyl benzene rose 7.8%, butadiene, rose 119.8%, moreover, black carbon, additives, cord, and other products rose by more than 20%. Affected by this, starting in October, a growing number of tyre manufacturers began to rise in price notice. Tyre price has gone up from the beginning of the exploratory development to the present comprehensive rise, some tire enterprises gain of close to 10%. At present China's tire industry gradually into the adjustment of recovery. The supply side, as the tire factory investment return to rational, industry growth or capacity will remain below 5%. Demand side, the passenger cars and heavy consumption of policy stimulus lead to overdraw earlier this year, so the probability of falling sales growth next year is larger, the fiscal policy to continue, under the condition of infrastructure to maintain growth, tire material consumption will maintain rigid demand.

4, middle reservoir declining industry less resilient

Qingdao bonded area rubber inventory decline since march this year, dropped for nine months, of the lowest lows at the end of October 83000 tons down 70% from the year's high of 278000 tons, the lowest since September 11. Which day gel inventory of 47600 tons, compound rubber inventory of 05100 tons. Bonded area inventory is dramatically down for a long time, its reason is a downstream factory direct imports increased, to port customs declaration directly into the factory, not into the bonded area; Secondly, the trade is shrinking, the bonded area trading activity weakened; Just need three is downstream, outbound faster than put in storage. Low market inventory to reduce the flexibility of the industrial chain, October home once $rubber prices caused by the cash liquidity shortage.

In November, after ship the goods to the port, the bonded area in stock began to seasonal tired stage. Qingdao free trade zone by the middle of December rubber inventories continue to rebound, inventory volume totaled 105600 tons, 22400 tons of relatively low growth. Inventory of about 75100 tons of concrete, natural rubber, the end of November 07300 tons; Compound rubber, 05100 tons, steady; Synthetic rubber is 25400 tons, down 01900 tons compared with the end of November. Late middle part inventory is still low at present, traders have inventory requirements, and the moment in Thailand seasonal off-season, high yield and tire production material bonded area inventory will continue to maintain growth. Overall, the market this year to inventory relatively sufficient, in the first half of next year day glue pulled during the cutting, the spot is still relatively tight liquidity.

China is the world's highest cost of production, producing a home-made glue for overpriced market share proportion is very small, there were only two way, latex is a hoarding in the spot library, 2 it is to the futures delivery library. At present most state-run factory product all need through the delivery of the warehouse receipt to the spot to ensure the liquidity, the previous period due to the high warehouse become the norm. Futures warehouse receipt quantity at peak this year has more than 300000 tons, the total inventory is over 340000 tons. With 16 years contract expire, erase old glue, 170000 tons, the current futures warehouse receipt is 209000 tons, 275000 tons of futures subtotal. Forecast this year full latex between 35 and 400000 tons of production, and so far this year in May after new warehouse receipt only more than 60000 tons, all remaining emulsion will stop cutting period gradually into that of the previous period, so inventory will continue to rise further. When futures to the spot price of regression, 1709 contracts and will become the natural short contracts.

Five, synthetic rubber price swings this year

From rubber and synthetic rubber price charts to see this day, the three movements synchronicity is very high, but in two periods synthetic adhesive glue is higher than the day, a appear in the second quarter, butyl benzene relatively strong; Another time in the near future after August, polybutadience rubber relative strength, first start the rally. Butadiene in the context of the current, because raw material prices are high and supply is limited, together with some factory production, sales company straight for the rate is as high as 60% above, the spot market shortage of butadiene prices remain strong. Because of the existence of substitute, synthetic rubber run high for a long time to day rubber prices supporting role.

6, monetary liquidity loose goods round fired

First 11 months of 2016 China's total social financing reached 16.1 trillion yuan, 2.5 trillion yuan more than the same period last year. At the same time, monetary liquidity is greatly increased, began to accelerate, M1 growth from the mid - 2015 - M2 growth rate of more than 13.5% in October that year, a peak of 25.4% in July this year, fell in November to 22.7%. Commodity futures volume level obviously is higher than last year, especially industrial products in the most significant; For agricultural products is not popular with money, the price also relatively mediocre performance. In addition, the price movements of Shanghai rubber and contract of precipitation funds appear quite high consistency, that this year's surge to a large extent still comes from the hype, speculative funds is still one part of the balance wheel. If future derivatives risk appetite back, then the Shanghai rubber prices will also return to the fundamentals, fix the present state of high premium.

7, depreciate the renminbi

Besides industrial rubber tight balance between supply and demand to support the price, the falling yuan also stimulate the rise of the key factors in the future. At present, the yuan has hit a seven-year low. Rubber is a typical "two head abroad" goods, a head of supply is dominated by foreign, depreciation caused the rise in the cost of imports; On the other side is half tyre production for export, rubber end demand is also affected by foreign, depreciation, apparently, is conducive to exports, the superposition of two factors effect can also be good for rubber good support.

8, technical analysis,

According to the long-term trend line support, at the beginning of 2001, 2008 and 2016 low together build the absolute bottom of the rubber price. Look from the history of k line graph, for shock multiple area between 17000-30000, long-short fierce game, follow-up in the glue price range unavoidably have repeatedly.

Three, operation Suggestions:

Upstream output this year end under the dual role of the weather and the price elasticity of supply amplifier, producing the contradiction between supply and demand of lack of raw materials and finished products are moderate. This year, the downstream has performed better than expected, investment and policy stimulus at the same time, vehicle and tire industry welcomed encouraging growth. Rubber industry in the 5 years bear market, a rare state of tight balance between supply and demand. Periodic supply curve shift to the left and the demand curve moves to the right, the growth of rebalancing mutual switch triggered industry, the main line throughout the course of the 2016 most direct embodiment is to reduce global inventories. Speculative funds also take this opportunity to hype, enlarge the industry of contradictions, rubber prices rebounded sharply 10925 yuan/ton, up 113.68%.

Throughout these rubber support price of supply and demand factors, weakening the risks to start the second half of next year. After el nino and la Nina, the region a large probability the weather will be good this year, then according to the open cut area is calculated, and the supply will return into the general upward trend. Policy stimulus to boost car this year, next year after overdraw consumption growth will fell, new demand is relatively scarce. In addition, after the July of the previous period will also turn into high inventories of recirculation, the fundamentals of multiple pressure prices could turn weak pattern, form throughout the year after magnified form first, ranges between 15000-25000.