What are the trading opportunities in the futures market in 2025?

Farewell to the last trading day of 2024, we welcome the year 2025. In the past year, the commodity market has experienced a magnificent market trend. The agricultural products, non-ferrous metals, precious metals, energy and chemical industries, and black building materials sectors have developed their own unique market trajectories under the influence of multiple factors such as fundamentals and policies. Specifically, gold prices have repeatedly hit historical highs, oil prices have intensified and fluctuated downwards, agricultural products such as soybeans and corn have shown significant declines, non-ferrous metals represented by copper have risen first and then fallen, and black metals have performed poorly.

The stock index will experience significant fluctuations in 2024, and there will still be structural opportunities in 2025

In 2024, the A-share market will experience significant volatility. From the perspective of price fluctuations, it is very clear to distinguish by market value, with the large cap stock index outperforming the small cap stock index throughout the year. As of the close of December 30, 2024, the annual fluctuations of the SSE 50, CSI 300, CSI 500, CSI 1000, and CSI 2000 indices were 16.87%, 16.55%, 8.65%, 4.39%, and 0.82%, respectively.

There are three obvious driving forces behind the fluctuations in the A-share market in 2024: first, the continuous efforts of macro policies. Since the end of September, a package of stable economic growth policies, known as the 'combination punch', has been implemented one after another, stimulating market sentiment. Second, the regulatory policies for the capital market have been strengthened. The new 'National Nine Measures' have been introduced, advocating that enterprises give back to investors through increasing dividends, repurchase efforts, and other means, and advocating that investors follow the value concept. Third, fund stratification. On the one hand, institutional funds represented by insurance funds, public funds, and social security have increased their allocation of blue chip dividend assets; on the other hand, small and medium-sized investors, leveraged funds, and other groups prefer small and micro cap stocks represented by themes and technology. Analyst Wang Peicheng said.

Looking ahead to 2025, Wang Peicheng believes that there are structural opportunities for various stock index varieties, and rhythm is more important. Relatively speaking, more attention is paid to the Shanghai and Shenzhen 300 and the CSI 1000. In the first quarter, domestic listed companies were in the period of annual report disclosure, and the market may experience fluctuations. The Shanghai and Shenzhen 300 companies with better performance quality may have a temporary advantage. In the second half of the year, with the initial results of the supply side clearance of the domestic midstream and downstream manufacturing industry, the CSI 1000 companies with higher content of new quality productivity may have a temporary advantage, "said Wang Peicheng.

Precious metals show impressive performance in 2024, but may rise first and then decline in 2025

In 2024, the precious metal market will perform remarkably well. The gold trend is evident, constantly reaching historical highs. COMEX gold reached a high of $2801.8 per ounce. As of December 30, 2024, COMEX Gold's annual increase was 27.2%. Silver has significantly strengthened and fluctuated greatly. COMEX silver reached a high of $35.07 per ounce. As of December 30, 2024, COMEX silver has an annual increase of 24.75%.

Shi Jialiang, Assistant General Manager of Zhongtai Futures Industry and Finance Development Headquarters, introduced that the strong performance of precious metals in 2024 is mainly driven by the resonance of positive factors in macro, fundamental, and technical aspects. Specifically, on a macro level, the geopolitical situation and the uncertainty of the US presidential election continue to affect the trend of precious metals as a safe haven. In the first half of the year, it was mainly affected by re monetization and global central bank purchases, while in the second half, it was mainly affected by concerns about a global economic recession. Fundamentally, global central banks continue to purchase gold, the size of gold ETFs continues to rise, effective demand for gold increases, and the supply side is relatively stable.

For 2025, Shi Jialiang stated that the macro environment facing the precious metal market remains complex, and the operational logic is still detached from traditional interest rate and inflation frameworks. Re monetization and global central bank gold purchases continue to support the trend of precious metals, and the US economic trend may have a first up and then down impact on expectations of loose Federal Reserve policies. It is expected that the probability of the Federal Reserve cutting interest rates twice in 2025 is high, and the interest rate cuts may mainly be concentrated in the first half of the year, while the possibility of interest rate cuts in the second half of the year is low. The expectation of interest rate cuts by the Federal Reserve in the first half of the year will have a positive impact, but once the interest rate cuts are suspended, the US dollar index and US bond yields will fluctuate and tend to be strong, which will have a negative impact on precious metals.

The trading logic of non-ferrous metals will rotate multiple times in 2024, and will shift to demand driven in 2025

In 2024, non-ferrous metals experienced significant fluctuations, with trading logic switching multiple times throughout the year. From the perspective of annual fluctuations, alumina, zinc, and tin are relatively strong, with annual increases of 35%, 18%, and 17%, respectively. Aluminum and nickel are relatively weak, with annual increases of 2.03% and 0%, respectively.

The dominant factors for price fluctuations in the non-ferrous metal market around August 2024 are different. Prior to August, the market was mainly driven by demand trading. Specifically, the Federal Reserve's interest rate cut process and the global manufacturing PMI's rise turned demand expectations into optimism, driving a general rise in non-ferrous metals before May. The global manufacturing PMI fell, and concerns about a recession in the United States led to a general decline in non-ferrous metals from June to August. After August, the market was mainly driven by supply trading, with different supply patterns for various varieties and divergent trends. Among them, the grade of alumina mines in China decreased, and the rainy season in Guinea, the main overseas production area, caused disturbances to supply; the grade of zinc mines overseas decreased, and new projects did not progress as expected; and the tin mines in Myanmar's Wa State were shut down for a long time. These three varieties have prominent contradictions in the mining end, and prices are relatively strong. The contradiction between the supply side of aluminum and nickel is somewhat flat, and the price support is relatively weak. ”Pan Baolong, a non-ferrous metal analyst at Zhengxin Futures, said.

Pan Baolong stated that the non-ferrous metal market may once again shift towards demand driven by 2025. Varieties such as alumina and zinc with strong expectations of improvement on the supply side should pay attention to the pressure on prices caused by the easing of supply.

The energy and chemical sectors will show differentiation in 2024, and the differentiation will continue in 2025

The performance of the energy and chemical sector will be differentiated in 2024. The annual increase in natural rubber is 25.86%, while the annual decrease in soda ash is 29.41%.

In the view of Dong Dandan, Chief Analyst of Energy and Chemical at CITIC Securities Futures, the factors that will affect the trend of crude oil in 2024 mainly include geopolitical situation, supply and demand, etc. The factors that dominate the price trend of chemical products are mainly maintenance rhythm, inventory, operation, production capacity release cycle, etc.

Looking ahead to 2025, Dong Dandan believes that there will be significant differentiation in the energy sector.

"The performance of crude oil in 2025 will be stronger than that of coal and natural gas. There will be many uncertainties in the supply side of crude oil in 2025: first, the uncertainty of OPEC+'s control over supply, second, Iran's crude oil supply, third, how the Russia-Ukraine conflict will end, and fourth, the production of non OPEC+oil producing countries. The overall increase of demand side is limited. The supply and demand balance of crude oil in 2025 will change from tight to loose, with average price or downward movement. The annual fluctuation range of Brent crude oil is 68 to 78 dollars/barrel, and the fluctuation range of SC crude oil is 490 to 610 yuan/barrel." Dong Dandan said.

Considering that the capacity expansion of most varieties in the chemical industry is nearing its end, Dong Dandan expressed a relatively optimistic view on styrene, ethylene glycol, methanol, caustic soda, rubber, and short fiber, which are generally characterized by low or zero capacity growth rate. Relatively bearish on PTA PX、 Bottle tablets, urea PVC， The common feature of these varieties is that their production capacity growth rate is still relatively high.

In addition, Dong Dandan believes that by 2025, there will be significant differentiation in the trends of high sulfur fuel oil, low sulfur fuel oil, and asphalt, which are highly correlated with crude oil. Due to the reduction in oil supply from Iran and Russia, the supply of high sulfur fuel oil will continue to tighten. The supply and demand of low sulfur fuel oil are stable, lacking highlights. The demand for asphalt is worth looking forward to in 2025. 2025 is the year when the 14th Five Year Plan comes to an end, and the demand for asphalt may increase significantly.

In 2024, the overall trend of black series will decline, and the price elasticity of raw materials will be greater than that of finished products in 2025

In terms of black materials, there is an overall downward trend in 2024, with a high point in January and a low point in September. The decline in raw materials is greater than that in finished products.

In the view of Lin Na, a black researcher at Zhongyuan Futures Research Institute, there are three main factors that will affect the price fluctuations of black series in 2024: first, the supply and demand structure. The downstream of rebar is mainly affected by real estate and infrastructure. In recent years, as the demand for steel in real estate has weakened, the fundamentals of rebar have become more relaxed. With shrinking profits, production lines have been continuously shifting towards sheet metal. The second is cost support. The continuous decline in steel prices is often accompanied by a decrease in raw material prices. The sale of rebar in mid-2024 led to a rapid drop in steel prices, causing widespread losses for steel mills and overall downward pressure on raw materials, resulting in a spiral decline in steel prices. The third is macro factors. The black industry chain, especially downstream, mainly involves important areas of the national economy such as infrastructure, real estate, and manufacturing, and is more significantly affected by macroeconomic policies. In the absence of major fundamental contradictions, prices are more likely to be boosted by policy expectations.

Looking ahead to 2025, Lina believes that the price elasticity of black raw materials is expected to be greater than that of finished products. Specifically, the four major overseas mines are still in a production capacity expansion cycle, and 2025 is the year when the 14th Five Year Plan ends. Under the "dual carbon" target, it is difficult to form an increase in domestic crude steel production. At the same time, steel mills are in a long-term low profit structure, and iron ore is expected to continue its loose supply pattern in 2025. The price center may shift downwards, and it is expected to continue exploring the non mainstream mining cost line of around $80/ton. In terms of coking coal, from the perspective of supply and demand structure, the clearance of Mongolian coal will remain high in 2025, and domestic mines will also face pressure to resume production. The loose fundamentals are difficult to reverse in the short term.

Relatively speaking, the pressure on steel inventory may be lower than that on the raw material side, and the weak supply and demand pattern of rebar, as well as the long-term low inventory strategy of traders, determine that inventory contradictions are relatively limited and more susceptible to policy influences. Therefore, it is necessary to pay attention to the demand side's ability to undertake production after the transfer to hot coils, "said Lina.

Agricultural products will experience mixed ups and downs in 2024, facing significant uncertainty in 2025

In terms of agricultural products, there will be a significant differentiation trend in 2024.

In the vegetable oil sector, palm oil saw an annual increase of 24.50%, rapeseed oil saw an annual increase of 12.47%, and soybean oil saw an annual increase of only 1.49%. Liu Jin, the head of agricultural products at Green Dahua Futures Research and Investment Consulting Department, stated that palm oil led the rise in the vegetable oil sector mainly due to supply tightening and demand expansion; Rapeseed oil, supported by the reduction in European rapeseed production, performed second only to palm oil; Global soybean yields have been high for three consecutive years, and factors such as the expected contraction of US biodiesel policies have made soybean oil the weakest among the three major oils.

In 2024, the overall trend of "double meal" in China showed an upward trend followed by a downward trend, with soybean meal experiencing an annual decline of 20.68% and rapeseed meal experiencing an annual decline of 18.85%. Liu Jin stated that the domestic supply of soybean and rapeseed raw materials has increased, while the price of "double meal" continues to decline due to factors such as stable pig farming scale, low prices of alternative proteins, and increased use of amino acids.

In terms of white sugar, 2024 is basically divided into three stages, namely high-level oscillation, gradual decline, and bottom rebound. Liu Jin introduced that in the first quarter, due to factors such as the accumulation of domestic sugar reserves and the slowdown of overseas supply, Zhengzhou Sugar operated in the range of 6200 to 6700 yuan/ton. After Brazil started a new season of sugar production, its impressive production and export data gradually led to a downward trend in domestic and international sugar prices, with Zhengzhou Sugar hitting an annual low of 5536 yuan/ton in mid August. Entering September, affected by the drought in S ã o Paulo state, Brazil, the market began to lower its expectations for future global sugar supply, and Zhengzhou Sugar Corporation followed the trend of stabilizing and rebounding in the external market.

The price of red dates is expected to experience a fluctuating downward trend in 2024. Liu Jin stated that the market gradually declined in the first half of the year due to downstream demand, but the downward trend slowed down in the second quarter due to low inventory levels. Entering the second half of the year, the climate conditions in Xinjiang's production areas are good, and the market has a clear expectation of an increase in red date supply in 2024, with the market continuing to weaken. After entering the fourth quarter, as the red dates gradually fell and the high yield expectations continued to be fulfilled, jujube farmers who had previously been reluctant to sell at low prices also began to sell. After calculating the processing cost, the market eventually stabilized at over 9000 yuan/ton, a decrease of nearly 40% from the beginning of 2024.

The cotton trend in 2024 can be divided into three stages: high-level oscillation, breakthrough downward, and stabilization and bottoming out. Liu Jin stated that at the beginning of the year, driven by external factors, Zhengzhou cotton rebounded to a temporary high of 16470 yuan/ton. Subsequently, under the dual pressure of high yield expectations for new cotton and sluggish consumption, prices entered a downward channel, with Zhengzhou cotton falling for five consecutive months, reaching an annual low of 13200 yuan/ton. Despite the policy push before the National Day holiday, Zheng cotton briefly rose, but later the market focus returned to the industrial chain, and Zheng cotton once again hit its annual low.

For corn, Liu Jin introduced that in the first half of the year, the supply and demand were relatively balanced, and Dalian corn maintained a fluctuating and orderly operation. In the second half of the year, there was a significant increase in the supply of import substitutes, and downstream enterprises were cautious in their procurement, maintaining rigid inventory. The temporary supply easing pressure caused a significant decline in the market center of gravity. In the fourth quarter, new grain gradually went public, and various purchasing entities launched acquisitions. Market sentiment improved slightly, and the market operated weakly in the range.

For eggs, 2024 is a game of weak expectations and strong reality. Liu Jin introduced that in the first half of the year, the increase in supply and the decrease in feed costs put pressure on egg futures to operate in a low range. In the second half of the year, driven by favorable factors such as a decrease in egg production rate and better than expected consumption, egg futures will repair their basis upwards.

Looking ahead to 2025, Liu Jin believes that with the recovery of global production and the gradual improvement of demand, the supply-demand imbalance of agricultural products will be somewhat alleviated. However, the increasing uncertainty in the international trade environment and factors such as geopolitical situations will have a significant impact on the price trends of agricultural products. In addition, the impact of the transition to new energy on the demand for agricultural products will gradually become apparent, and the development of renewable energy sources such as biodiesel will boost the demand for vegetable oil.