Commodity and Cyclical Plays


([email protected]) #706

Is any one tracking cotton prices, have been checking Indexmundi site and the prices are at the peak.
I believe this should be -ve for Trident, Ambika Cotton,Nitin spinners etc but when I had seen the Q1 results they werent that bad, am I missing anything?


(Bhavesh) #707

For Trident, it may be slightly negative as realizations would be higher given recent rupee depreciation.
For Ambika, Nitin Spinners the spread between yarn and cotton is determinant of margins. Generally, the spread is around Rs90/kg. Unsure what it is currently


([email protected]) #708

Thanks @bhavveshh for the details, for Ambika and Nitin does it mean that an increase in cotton price will be factored in the yarn price that they sell to the customer?


(Bhavesh) #709

It depends on demand supply of yarn. So as of now what I understand is China is buying yarn from India after it applied duty on mports of cotton from the US. So yarn and cotton demand is high.
Now key would be to watch out cotton arrivals in September in India
If the availability of cotton is good and priced fall, it’s good for yarn makers.
The situation is very dynamic and can change quickly. I don’t track Nitin and Ambika so can’t comment on them specifically


(1.5cr) #710

What do you guys think of SAIL and the steel cycle?


(Jiten Parmar) #711

It was very nice to talk my heart out on the Unlimited Abundance Series.

Here I talk about my investment philosophy, value investing, cyclical investing, investor traits and so on. Duration is 50 minutes, so be forewarned. Views welcome.


(SOHAN) #712

Hello jiten sir very knowledgable session.sir you mentioned about sugar cycle downtrend in 2013 which are industris in 2018 which are in down trend present


(krrish seth) #713

Excellently explained bade bhai. Enjoyed the way you explain investing


(Raj A A) #714

Local Cos Fear Dumping by Foreign Steel Players

Firms expect China, Japan and Korea to divert shipments originally meant for US, EU to India; ICRA says rupee’s fall may boost steel exports
[email protected]

Mumbai:

India is facing the threat of dumping of foreign steel, led by the diversion of exports originally meant for the US and European Union, which could lead to an encore of 2016 when local mills making the alloy were crippled by shipments from overseas, fear domestic steelmakers.

Ratings firm ICRA, in a note on Wednesday, said in the first quarter of fiscal 2019, the country’s steel exports dropped by over 33% whereas imports grew more than 11%. Consequently, India turned a net importer in the quarter, after having been a net exporter for the last two years.

However, with a sharp rupee depreciation in recent months, the ratings firm expects a slide in steel imports and boost to exports, which is likely to improve India’s overall steel trade balance.

The industry has started “sensitising” the government to take action to check unfair imports that could accelerate in the future. It wants the reference price of the antidumping duty to be pushed up or a replication of what Europe has recently done to protect local steelmakers by providing safeguard measures.

“In the last quarter (first quarter of FY19), China, Japan and Korea diverted twice their export to the US into India,” Seshagiri Rao, joint managing director at JSW Steel, had told reporters in July at a conference held to announce the company’s first-quarter results. He said the imposition of safeguard measures by the EU would hit the industry more in the coming quarters.

He had bolstered his statement with data from the last quarter. Imports into the US from China, Japan and Korea reduced by 240,000 tonnes after the imposition of tariffs. But their collective shipments into India increased by 450,000 tonnes.

“Countries are putting safeguard measures to protect their domestic steel industry against unfair dumping. The Indian government had taken safeguard measure by way of reference price at $480 per tonne to curb dumping. This has now become redundant in view of the higher international prices. Consequently, imports into India have risen by 31% in Q1 of FY19 compared to Q4 FY18. Hence there is a definitive case for revision in reference price,” said an Essar Steel spokesperson.

While the US had, in March, imposed a 25% import tariff on steel entering that country, more recently, on July 18, the European Commission announced safeguard provisional measure to curb diversion of exports to Europe. According to the measure, a 25% tariff will be imposed once imports exceed the average import of the last three years. This will be applicable to all countries save some developing ones.

“Unlike the USA, the EU tariffs would be more worrying for Indian steelmakers, given that export volumes by Indian mills to the EU are over five times of volumes exported to the USA," said Jayanta Roy, group head of corporate sector ratings at ICRA. “Moreover, as per India’s Q1 FY2019 steel import data, redirection of impacted steel volumes from countries like Japan and South Korea, with whom India has free trade agreements, is clearly visible.”
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(1.5cr) #715

Imports wont be a problem as the govt. seems to have ringfenced the domestic steel industry. We have MIP and anti dumping that extends to 2022 if im not mistaken. We plan to take our steel production to 300mt by 2030, the govt wont allow imports to disrupt this market. Steel cos were big contributors to the NPA mess, they also create alot of employment. I think the growing demand with regards to steel coupled with govt. reforms should keep prices up. I think the market is big enough to absorb some level of imports. GDP multiplier is above 1 for steel, the first time since 2013 if im not wrong. This would imply 8%+ growth in the industry. We have no new supply coming up until 2022 or so. So that again should keep prices up. I dont see this as an issue as im sure the anti dumping measures will keep imports at bay for the most part. However this wont apply to Japan and Korea. China are also cutting capacities. They do not have much incentive to export. Exports have been falling over last few years. One can go through Arcelor Mittals presentations for further data on this. I forsee firm steel prices going forward. I of course do not see a substantial jump in prices from current prices.


(SOHAN) #716

Hello all.is any one following close to adhesive and granite industries?


(bharat19) #717

Can someone tell any source to track Caustic Soda Prices. Companies like Meghmani and GACL looks good. Gujrat Alkali is trading at 7 PE TTM and 5.5 PE (If Cash is accounted). Company looks decent as having double digit Profit Growth over 3 Yr , 5 Yr and 10 Yr period and double digit return on equity ratios.


(nil_71) #718

http://www.sunsirs.com/uk/prodetail-368.html


(Amit) #719

https://www.metalbulletin.com/Article/3831445/Investors-should-focus-on-battery-materials-not-EVs-Blackstone-Resources-CEO.html


(Amit) #720

(Manohar T. Patil) #721


(Akshay Kumar) #722

https://chemweek.com/CW/Document/94489/IHS-Markit-WPC-2018-Global-ethylene-capacity-maxed-out-through-2022


(1.5cr) #723

Well and truly hope that this happens. It will not only benefit India but our entire planet.
There are 2.5b trucks and cars on the planet. The maximum output (hypothetically speaking best case scenario) for production of EVs would be around 100m units per annum (Source: Elon Musk). It would take roughly 25 years for our entire planet’s cars and trucks to be electrical. This is a hypothetical best case scenario. See how far we are from moving to a greener planet?


(Kushal Masand) #724

Pointers for major ethylene producers in India?


(Jiten Parmar) #725

There has been a very good rise in BOPET prices. Just FYI. Pricing much better than Q1.