Report Industry Investment Ratings - Industrial silicon: Oscillating [7] - Polysilicon: Oscillating [8] - Lithium carbonate: Oscillating and bullish [12] Core Viewpoints of the Report - Central Financial Conference emphasizes phased elimination of outdated production capacity, strengthening investors' expectations of supply contraction in the silicon market. Meanwhile, disruptions in domestic lithium supply, with major lithium mines in Jiangxi halting production, have increased the risk of supply disruptions and driven up lithium prices. In the short - to - medium term, expectations of supply contraction and rising costs support the prices of new energy metals. In the long term, if there is no substantial supply contraction or significant improvement in demand, silicon prices may decline, and high growth in lithium carbonate supply will limit the upside of lithium prices [2] Summary by Relevant Catalogs 1. Industrial Silicon - **Price and Inventory**: As of August 11, the spot price of industrial silicon fluctuated. The latest domestic inventory was 439,900 tons, a 0.9% decrease from the previous period. The monthly output in July was 338,000 tons, a 3.2% increase from the previous month and a 30.6% decrease from the same period last year. From January to July, the cumulative production was 2.21 million tons, a 20% decrease from the same period last year. In June, the export volume was 68,323 tons, a 22.8% increase from the previous month and an 11.6% increase from the same period last year. From January to June, the cumulative export volume was 340,705 tons, a 6.6% decrease from the same period last year [7] - **Main Logic**: The supply of industrial silicon continues to recover. In August, the supply pressure may further increase. Demand shows some improvement, but the increase in demand from the aluminum alloy sector is limited. With the continuous recovery of supply, social inventory and futures warehouse receipts are expected to further accumulate [7] - **Outlook**: In the short term, silicon prices will continue to oscillate due to macro - sentiment and coal prices. The resumption of production by large enterprises will be crucial, and concentrated resumptions may further suppress prices [8] 2. Polysilicon - **Price and Trade**: The成交 price range of N - type re - feedstock was 45,000 - 49,000 yuan/ton, with an average price of 47,200 yuan/ton, a 0.21% increase from the previous week. The latest polysilicon warehouse receipts on the Guangzhou Futures Exchange were 4,700 lots, an increase of 1,080 lots from the previous value. In June, the export volume was about 2,222.65 tons, a 5.96% increase from the previous month and a 39.67% decrease from the same period last year. From January to June, the export volume was 11,389.98 tons, a 7.23% decrease from the same period last year. In June, the import volume was about 1,112.69 tons, a 40.3% increase from the previous month. From January to June, the import volume was 11,209.78 tons, a 47.59% decrease from the same period last year [8] - **Main Logic**: Macroeconomic factors and rising coal prices have led to wide - range fluctuations in polysilicon prices. Supply is expected to increase in August. In the long term, it is necessary to pay attention to whether anti - cut - throat competition policies will restrict supply. Demand may weaken in the second half of the year due to the high growth in the first half [11] - **Outlook**: Anti - cut - throat competition policies have significantly boosted polysilicon prices. The implementation of policies needs to be monitored, and if policy expectations fade, prices may reverse [12] 3. Lithium Carbonate - **Price and Market**: On August 8, the closing price of the lithium carbonate main contract increased by 5.25% to 81,000 yuan, hitting the daily limit. The total open interest increased by 1,676 lots to 783,699 lots. The spot price of battery - grade lithium carbonate increased by 2,600 yuan to 74,500 yuan/ton, and the price of industrial - grade lithium carbonate increased by 2,500 yuan to 72,300 yuan/ton. The average price of lithium spodumene concentrate was 910 US dollars/ton, equivalent to 77,300 yuan/ton of lithium carbonate. The warehouse receipts increased by 560 tons to 19,389 tons [12] - **Main Logic**: The production cut at Ningde Times' Jiaxiawo Mine has become the focus of market speculation. Fundamentally, production has rebounded, and the mine's shutdown will reduce weekly ore supply by over 2,000 tons of LCE. Demand is stable, and social inventory is slightly increasing. In the future, a significant supply - demand gap may emerge, but high prices may stimulate supply [12] - **Outlook**: The supply - demand gap caused by the shutdown is expected to keep prices oscillating and bullish [13]

1. Report's Industry Investment Rating No relevant content provided. 2. Core Viewpoints of the Report - In the fourth week of July, production maintained a certain level of resilience, with good freight volume in the industrial sector and stable开工率 in coking, chemical, and automotive industries. In the construction industry, cement supply was low, demand marginally improved, and asphalt开工率 decreased. In the real estate sector, both new and second - hand housing sales recovered, but the trend needs further observation, and housing prices need to stabilize. External demand saw an increase in throughput, and freight rates showed a differentiated trend. Consumption showed a convergence in travel enthusiasm, with a differentiation between urban travel data and flights, while automobile consumption remained resilient. Prices of most commodities, such as black metals, were strong, while crude oil prices were volatile [2]. 3. Summary by Relevant Catalogs 3.1 Consumption - Travel: The resilience of travel enthusiasm converged, with a decline in the year - on - year growth of subway travel and congestion delay index, an increase in the total number of flights, and a flight execution rate basically the same as last year [2]. - Commodity consumption: Automobile consumption remained popular, textile consumption decreased, and express delivery collection was at a high level [2]. 3.2 Real Estate - New housing: The transaction volume of new housing increased, with third - tier cities leading [3]. - Second - hand housing: Second - hand housing transactions also increased, with the markets in Beijing, Shanghai, and Chengdu warming up slightly, and the market in Shenzhen cooling down. The recovery of second - and third - tier cities needs further observation. The listing price and quantity of second - hand housing decreased [3]. - Land: Last week, land transaction volume was weak, but the premium rate improved [3]. 3.3 Production - Freight volume remained high, and开工率 data showed a differentiated performance [4]. 3.4 Construction Industry - The year - on - year arrival of construction funds decreased. Cement demand was stronger than supply, black metal supply and demand were weak, and asphalt开工率 decreased [5]. - The开工率 of asphalt decreased both year - on - year and month - on - month, and its price also decreased. The开工率 of styrene and PVC improved [6]. 3.5 External Demand - Freight volume: Port cargo throughput and container throughput increased [7]. - Freight rates: The RJ/CRB index increased year - on - year, the Baltic Dry Index (BDI) rose significantly, and international shipping rates showed a differentiated trend. The CCFI index decreased month - on - month, while the SCFI index increased [7]. 3.6 Prices - Agricultural products: The price index of agricultural products decreased slightly [10]. - Industrial products: The domestic Nanhua Industrial Products Index and the overseas RJ/CRB Index both increased. Crude oil prices were volatile, while the prices of black metals, glass, and most other commodities, such as manganese silicon, lithium carbonate, coking coal, and ferrosilicon, were strong [2][10].

Group 1: Policy Signals and Market Reactions - The recent signals regarding the orderly exit of backward production capacity emerged before the July 1 meeting of the Central Financial Committee, with some product prices stabilizing in June[3] - The Central Financial Committee emphasized the need to promote the orderly exit of backward production capacity, marking a shift from industry self-discipline to top-level policy[3] - Despite the policy signals, related industry stock performances remained subdued until the July 1 meeting, indicating a delayed market reaction[21] Group 2: Market Characteristics and Trends - The current market is expected to exhibit "pulse-like" trends due to unclear demand-side signals, contrasting with the 2016 supply-side reform that saw simultaneous demand boosts[22] - The segmentation of industries will likely show significant differentiation between "old industries" (e.g., steel, coal, cement) and "new industries" (e.g., new energy vehicles, lithium batteries)[22] - Focus should be on new industries with external demand, which may offer higher profit elasticity under similar supply-side adjustments[22] Group 3: Economic Implications and Risks - The stabilization of related industries will significantly aid macroeconomic structural adjustments and improve price factors, contributing to the overall elevation of the A-share market[23] - Risks include the potential underperformance of the orderly exit of backward production capacity, unexpected macroeconomic fluctuations, and unforeseen tariff disputes[28]

Report Overview - Investment Rating: Neutral [4] - Core View: Iranian methanol plants are gradually resuming production, ports are experiencing a slight inventory build - up, and the basis has returned to a reasonable level after the June paper - cargo delivery. There is still pressure from future arrivals, and MTO plants have maintenance plans in July. Inland coal - based methanol production remains at a high level, but traditional downstream industries are resilient, and inland factories have no inventory pressure. The impact of the "orderly exit of backward production capacity" mentioned in the meeting needs further attention [3] Market News and Key Data Inland - Coal price: Q5500 Ordos thermal coal is 410 yuan/ton (+0) [1] - Production profit: Inner Mongolia coal - based methanol production profit is 715 yuan/ton (+8) [1] - Methanol prices: Inner Mongolia North Line is 2010 yuan/ton (+8), Inner Mongolia South Line is 2020 yuan/ton (+0), Shandong Linyi is 2330 yuan/ton (+0), Henan is 2210 yuan/ton (+20), Hebei is 2185 yuan/ton (+0) [1] - Basis: Inner Mongolia North Line basis is 196 yuan/ton (-3), Shandong Linyi basis is 116 yuan/ton (-10), Henan basis is - 4 yuan/ton (+10), Hebei basis is 31 yuan/ton (-10) [1] - Inventory: Longzhong inland factory inventory is 352,280 tons (+10,730), and Northwest factory inventory is 223,500 tons (+18,000) [1] - Pending orders: Longzhong inland factory pending orders are 233,250 tons (-7,450), and Northwest factory pending orders are 110,400 tons (-9,100) [1] Port - Methanol prices: Taicang methanol is 2460 yuan/ton (-25), Changzhou methanol is 2465 yuan/ton, Guangdong methanol is 2455 yuan/ton (+5) [2] - Basis: Taicang basis is 46 yuan/ton (-35), Guangdong basis is 41 yuan/ton (-5) [2] - Import price: CFR China is 283 dollars/ton (+0), and the East China import spread is 2 yuan/ton (-46) [2] - Inventory: Longzhong port total inventory is 673,660 tons (+3,160), Jiangsu port inventory is 333,000 tons (-23,500), Zhejiang port inventory is 176,500 tons (+37,000), Guangdong port inventory is 120,500 tons (-13,500) [2] - Downstream MTO operating rate: 84.60% (-2.82%) [2] Regional Spreads - Lubei - Northwest - 280 spread is - 25 yuan/ton (+28), Taicang - Inner Mongolia - 550 spread is - 100 yuan/ton (-33), Taicang - Lunan - 250 spread is - 120 yuan/ton (-25), Lunan - Taicang - 100 spread is - 230 yuan/ton (+25), Guangdong - East China - 180 spread is - 185 yuan/ton (+30), East China - Sichuan - Chongqing - 200 spread is - 20 yuan/ton (-25) [2] Strategy - 9 - 1 inter - period spread: Do reverse arbitrage when the spread is high [4] Directory Summary I. Methanol Basis & Inter - period Structure - Include figures such as methanol Taicang basis and methanol main contract, methanol basis in different regions relative to the main futures contract, and spreads between different methanol futures contracts [7][9][22] II. Methanol Production Profit, MTO Profit, Import Profit - Include figures of Inner Mongolia coal - based methanol production profit, East China MTO profit, and import spreads between different regions [26][30] III. Methanol Operating Rate, Inventory - Include figures of methanol port total inventory, MTO/P operating rate, inland factory sample inventory, and China methanol operating rate [34][36] IV. Regional Spreads - Include figures of spreads between different regions such as Lubei - Northwest, East China - Inner Mongolia, etc [38][46][48] V. Traditional Downstream Profits - Include figures of production profits of traditional downstream products such as Shandong formaldehyde, Jiangsu acetic acid, etc [53][58]

Core Viewpoint - The article emphasizes the need to promote the orderly exit of outdated production capacity to combat low-price disorderly competition and internal competition, thereby enhancing market vitality and optimizing resource allocation [2][4]. Group 1: Market Dynamics - The current low-price disorderly competition and internal competition reflect a significant lack of effective demand in the economy, exacerbated by external trade protectionism [2][3]. - Outdated production capacity poses a high-risk preference in the market, leading to adverse selection and moral hazard, which can disrupt market stability [2][5]. - The orderly exit of outdated production capacity is essential for achieving marginal balance in supply and demand, allowing competition to shift towards improving product quality and consumer surplus [2][6]. Group 2: Mechanisms for Exit - To facilitate the orderly exit of outdated production capacity, it is crucial to eliminate systemic barriers that hinder the operation of the Bankruptcy Law and improve the market exit mechanism [3][4]. - Strengthening market self-discipline and autonomy is necessary, including enhancing the checks and balances between principals and agents, and ensuring creditors can constrain the actions of company controllers [4][5]. - Regulatory bodies should conduct industry risk pressure tests and require companies to disclose their risk assessments regularly to manage potential risks effectively [4][5]. Group 3: Risk Management - Effective risk management involves quantifying and pricing the risks associated with outdated production capacity, which can aid in bankruptcy restructuring and liquidation processes [5][6]. - Misunderstanding of risks is a significant barrier to the exit of outdated production capacity; thus, the market's ability to identify, price, and allocate risks must be fully utilized [5][6]. - Creating a favorable business environment that encourages market participants to engage in risk-taking is vital for eliminating internal competition and low-price disorderly competition [6][7].

Group 1: Report Investment Rating - The report does not explicitly provide an overall industry investment rating. However, for individual products, the outlook for industrial silicon, polysilicon, and lithium carbonate is "oscillating" [5][8][9] Group 2: Core Viewpoints - Central Financial Conference re - emphasized the orderly elimination of backward production capacity, strengthening the expectation of supply contraction of silicon, leading to a significant rise in new energy metal prices. In the short - to - medium term, the price increase of industrial silicon and polysilicon has a positive impact on lithium carbonate. In the long term, low prices may accelerate the capacity clearance of domestic self - priced products, but the long - term over - supply problem of lithium carbonate may limit the price increase [2] Group 3: Summary by Product Industrial Silicon - **Viewpoint**: Supply - side policy expectations are positive, and silicon prices are oscillating upwards [5] - **Information Analysis**: As of July 2, the spot price of industrial silicon has slightly rebounded. Domestic inventory decreased by 0.2% month - on - month. In May, the domestic monthly output was 308,000 tons, a year - on - year decrease of 24.6%. Exports in May were 55,652 tons, a year - on - year decrease of 22.5%. The new photovoltaic installed capacity in May was 92.9GW, a year - on - year increase of 388.0% [5] - **Main Logic**: Sudden production cuts by large northwest factories support prices. If the production cut scope expands, the supply - demand situation in July may improve. The southwest is in the wet season, and the resumption of production is slower than usual. The demand side is weak, and the inventory has slightly decreased this week. As the silicon price rebounds, supply may recover, and inventory may accumulate again [5] - **Outlook**: The fundamental over - supply situation of industrial silicon remains unchanged. The current price increase is driven by policy expectations, and the price is expected to oscillate [5][6] Polysilicon - **Viewpoint**: The anti - involution policy has taken effect, and the polysilicon price has rebounded significantly [6] - **Information Analysis**: The average transaction price of N - type re - feedstock is 34,700 yuan/ton, a slight increase. In May, the export volume increased by 66.2% month - on - month, and the import volume decreased by 16.9% month - on - month. The cumulative new photovoltaic installed capacity from January to May increased by 150% year - on - year [6] - **Main Logic**: The polysilicon futures price hit the daily limit. Short - term production is low, and it is expected to rise to over 100,000 tons in June - July. The demand may weaken in the second half of the year after the end of the photovoltaic rush - installation [8] - **Outlook**: The demand for polysilicon may weaken in the second half of the year, but the anti - involution policy may cause large fluctuations in supply. The price is expected to have a wide - range oscillation [8] Lithium Carbonate - **Viewpoint**: Driven by demand expectations and sentiment, the lithium price remains oscillating [9] - **Information Analysis**: On July 2, the closing price of the lithium carbonate main contract increased by 1.88%. The SMM battery - grade lithium carbonate spot price increased by 350 yuan/ton. Zhongkuang Resources plans to upgrade its 25,000 - ton lithium salt production line [9] - **Main Logic**: Market sentiment is good, and demand production scheduling expectations are positive. Supply is increasing, and demand is expected to be good in July. Social inventory is accumulating, and warehouse receipt inventory is decreasing. It is recommended to wait and see or short at high prices after a rebound [9] - **Outlook**: Supply and demand remain in surplus, but the short - term reduction of warehouse receipts supports the price. The price is expected to oscillate [9]

Report industry investment rating - The report gives a neutral investment rating for the methanol industry [4] Core view of the report - Iranian methanol plants are gradually resuming production, and the port inventory accumulation rate has slowed down. After the paper cargo delivery in late June, the port basis has been weakening. There is still pressure on future arrivals, and MTO plants plan to conduct maintenance in July, so the port is still in a short - term inventory accumulation cycle. In the inland area, the operation rate of coal - based methanol plants remains high, but the traditional downstream shows strong resilience, and the inventory of inland methanol plants is under no pressure. The Central Financial and Economic Commission meeting on July 1 mentioned promoting the "orderly exit of backward production capacity", but there is no specific document yet, which requires close attention [3] Summary according to relevant catalogs I. Methanol basis & inter - period structure - The report presents multiple figures related to methanol basis including methanol Taicang basis and methanol main contract, methanol basis in different regions (Taicang, Lunan, Inner Mongolia North Line, Henan, Hebei, Guangdong) against the main futures, and inter - period spreads such as between methanol 01 and 05, 05 and 09, 09 and 01 futures contracts [7][11][23] II. Methanol production profit, MTO profit, import profit - Figures are provided for Inner Mongolia coal - based methanol production profit, East China MTO profit (PP&EG type), import spread between Taicang methanol and CFR China, and price differences between CFR Southeast Asia, FOB US Gulf, FOB Rotterdam and CFR China [27][28][32] III. Methanol operation and inventory - Information includes methanol port total inventory, MTO/P operation rate (including integrated plants), inland factory sample inventory, and China's methanol operation rate (including integrated plants) [35][36][38] IV. Regional price differences - Regional price differences are shown in figures such as Lubei - Northwest - 280, East China - Inner Mongolia - 550, Taicang - Lunan - 250, Lunan - Taicang - 100, Guangdong - East China - 180, and East China - Sichuan and Chongqing - 200 [40][46][49] V. Traditional downstream profit - Figures display the production gross margins of Shandong formaldehyde, Jiangsu acetic acid, Shandong MTBE isomerization etherification, and Henan dimethyl ether [50][56][58]

Report Industry Investment Rating No relevant information provided. Core Views - Copper prices are mainly driven by the tight supply - demand situation caused by cross - regional flow due to the copper tariff, and future price fluctuations will be affected by the Fed's interest - rate cut expectations [10]. - For crude oil, with the easing of Middle - East geopolitical risks and seasonal factors, the supply - demand situation has improved marginally. It is recommended to cautiously buy bearish options [11][12]. - For asphalt, as it enters the peak season, it is recommended to buy the 09 - 12 spread at low prices while operating cautiously [13]. - PP, plastic, and PVC are all expected to be in a low - level oscillation pattern due to factors such as high inventory, weak demand, and falling crude oil prices [15][16][18]. - The upward momentum of soybean oil has weakened, and it is expected to maintain a range - bound oscillation [19]. - For rebar, if the production - restriction rumors continue to ferment or materialize, there is still room for an upward movement, but the risk of a pull - back due to rumor falsification should be watched out for [21]. - For hot - rolled coils, if production restrictions are intensified and demand does not weaken significantly, it may maintain a strong oscillation pattern; otherwise, weak demand may limit its upward space [22]. - For coking coal, although there is a tight supply expectation, the upward space is limited due to weak demand [24]. - For urea, it is mainly in a consolidation phase and still faces downward pressure [25][26]. Summary by Variety Carbonate Lithium - The average price of battery - grade and industrial - grade carbonate lithium has increased. The supply side shows that upstream prices are firm, and the production cost and output of domestic carbonate lithium are rising. The demand side indicates that downstream acceptance of high prices is low, and the overall production capacity is loose. The upward trend is mainly due to market sentiment, and the upward space is limited [3]. Soybean Meal - The main 09 contract of soybean meal closed down 0.57%. Internationally, the new US tax bill may benefit US soybean growers, and the soybean good - to - excellent rate is lower than expected. Domestically, the inventory of imported soybeans and soybean meal has increased. It is expected to show an oscillatory adjustment pattern [4][5]. Copper - The Shanghai copper market showed a strong trend. The US manufacturing PMI has been in contraction for four months. The supply of copper is still increasing, and the inventory in most regions is decreasing. The export demand has increased due to the copper tariff event, but the overall demand is weak. The main logic for the price increase is the tight supply expectation caused by cross - regional flow [9][10]. Crude Oil - After the US military's intervention in Iran, the subsequent retaliatory actions and cease - fire have affected market sentiment. The supply - demand situation has improved marginally, but the Middle - East geopolitical risks still need to be monitored. It is recommended to cautiously buy bearish options [11][12]. Asphalt - The supply side shows that the start - up rate has rebounded, and the expected output in July has increased. The demand side indicates that the start - up rate of downstream industries has fluctuated, and the inventory is at a low level. With the easing of geopolitical risks, it is recommended to operate cautiously and buy the 09 - 12 spread at low prices [13]. PP - The downstream start - up rate has decreased, and the enterprise start - up rate has increased. The inventory pressure is high. With the sharp drop in crude oil prices, it is expected to be in a low - level oscillation [14][15]. Plastic - The start - up rate has decreased, and the downstream start - up rate is at a low level. The inventory pressure is high. With the sharp drop in crude oil prices, it is expected to be in a low - level oscillation [16]. PVC - The start - up rate has decreased, and the downstream start - up rate is low. The export is restricted, and the inventory is high. With the sharp drop in crude oil prices, it is recommended to short at high prices [17][18]. Soybean Oil - The main 09 contract of soybean oil closed up 0.63%. Internationally, the US soybean planting area is slightly lower than expected, and the quarterly inventory is higher. Domestically, the oil - mill start - up rate has increased, and the inventory has accumulated. It is expected to maintain a range - bound oscillation [19]. Rebar - The main contract showed a trend of "bottom - fishing and upward movement". The supply contraction expectation has increased due to production - restriction rumors, but the demand is weak. The raw material prices have rebounded. If the rumors materialize, there is upward space, but there is also a risk of a pull - back [20][21]. Hot - Rolled Coils - The main contract showed an "oscillatory upward and breakthrough" pattern. The supply - demand structure is characterized by "continued inventory reduction and rigid - demand support". The production has slightly increased, the inventory pressure is small, and the demand has improved. It is recommended to focus on production - restriction implementation and policy trends [22]. Coking Coal - The price closed up more than 3%. The supply side is expected to contract due to safety inspections and capacity - clearance expectations. The demand side is relatively weak. The upward space is limited due to weak demand [24]. Urea - The futures price showed a strong oscillation. The supply side has both maintenance and resumption of production, and the daily output fluctuates slightly. The demand side is weak, and the inventory is mainly reduced through exports. It is mainly in a consolidation phase and faces downward pressure [25][26].