It's the hottest. The steel price goes like this i

2022-09-23
  • Detail

That's great. The steel price in January is so high

the short-term sharp rise in steel prices at the beginning of the month also led to the rapid accumulation of risks. End users and middlemen were generally afraid of heights, and the high steel prices that lacked demand support were difficult to support. The market turned into a continuous downward trend since December 6. Then, although the performance was still repeated, the market pessimism gradually spread, and the spot price turned from north to south, from small factories to large factories into a comprehensive accelerated decline, and there was no sign of stopping falling by the end of the month. On December 28, the closing price of rb1805, the main contract of rebar futures, was 3758 yuan/ton, down 232 yuan/ton from the end of last month, with a month on month decrease of 5.81%. Compared with the sharp rise and fall of the spot price, the fluctuation range of the futures price this month is relatively small. When the spot price surged at the beginning of the month, the futures did not follow the sharp rise, and the futures basis once reached the historical extreme value of 1200 yuan/ton. When the spot price plummeted in the middle and late days, the futures did not follow the sharp fall, and the futures price difference narrowed rapidly, which fully reflects the function of futures to find prices

The author believes that the overall sharp decline in spot steel prices in December is mainly affected by the following factors:

first, from late November to early December, the export share to emerging countries will also be greatly increased in a short period of two weeks, and the steel price will increase by nearly 1000 yuan. The shortage of market resources has been over hyped, which also lays a hidden danger for the sharp decline in steel prices in the later period

second, in December, many domestic steel capacity replacement projects were intensively released, especially the production capacity of electric furnace steel in the central and western regions was relatively concentrated, which formed the expectation of accelerating the release of new capacity to the market. In addition, the profit of steel mills producing thread was significantly better than that of coil plate, and some steel mills used molten iron preferentially to produce thread, resulting in the gradual increase of thread supply

third, the sharp rise in steel prices in the early stage has exceeded the affordability of some end users. Some construction sites were shut down in advance, adding factors such as the weakening of seasonal demand and the shortage of project funds. The terminal demand shrank significantly in December, resulting in a backlog of steel mill inventory and social inventory

to sum up, domestic spot steel prices fell sharply in December, so what is the trend of steel prices in January 2018? What impact will the convening of the central economic work conference have on the steel industry? With limited space for supply compression and gradually weakening demand, will inventory in the industrial chain accumulate significantly? How about the price performance of raw materials such as iron ore and coke? With many questions, let's take a look at the analysis report of domestic construction steel market in January 2018. The following is a comprehensive summary of the content of the analysis report in January 2018. The basic operating conditions of domestic steel prices in January are as follows:

I. at the demand level, the national fixed asset investment in January increased by 7.2% year-on-year, and the growth rate fell by 0.1 percentage points compared with the previous 10 months. From the perspective of the three major investments, the growth rate of real estate investment in the first November was 7.5%, down 0.3 percentage points from the previous period; Infrastructure investment increased by 20.1% year-on-year, 0.5 percentage points faster than the previous period; The growth rate of manufacturing investment was 4.1%, unchanged from the previous period. The data of steel downstream industry in November was better than the market expectation, and the domestic economy still showed considerable resilience, which will also boost the steel market trend in the later period. As the end of the year approaches, seasonal demand declines and capital constraints appear, it is expected that the overall demand downturn in next month will be difficult to change

II. Supply level

the average daily output of crude steel in China in November was 2.205 million tons, a sharp decrease of 5.54% compared with October, the lowest level since March this year to build a unified green standard, certification and identification system for express packaging products. In mid November, the "2+26" cities in the North officially implemented the production restriction in the heating season. At the same time, in December, the production restriction of steel mills in Xuzhou, Jiangsu, Anyang, Henan, Wu'an, Hebei and other regions was further increased. It is expected that the national average daily output of crude steel in December will further fall to the level of about 2.15 million tons. From the perspective of inventory, the steel mill inventory and market inventory continued to rise in the middle and late December, putting some pressure on the market trend. However, on the whole, the current social inventory and steel mill inventory are at historical lows, and low inventory still supports the trend of steel price

III. cost factor

in December, the prices of coke and scrap steel soared, the price of iron ore also fluctuated higher, and the profit of steel mills narrowed significantly. After soaring this month, it is expected that the coke and scrap prices will be adjusted at a high level next month, and the iron ore price is expected to still have some room to rise, driven by the replenishment of steel mills. From the perspective of steel mill prices, current merchants' expectations for the future market are not high. In January, when the terminal demand further shrank, it is still waiting for steel mill prices to be further reduced to stimulate merchants' enthusiasm for winter storage. It is expected that the cost of next month will still support the steel price weakly

IV. at the macro level

first, the economic data in November was mixed, and the overall performance was better than expected

the economic data in November was mixed, and the overall performance was tepid. Among them, the import and export, credit and consumption data performed better than expected, but the industrial added value, fixed asset investment, fiscal revenue and expenditure and other data performed weaker. On the whole, the macroeconomic data in November was better than the market expectation, and the domestic economy still showed quite strong problems: the resilience of the steel market will also boost the trend of the steel market

II. The central economic work conference will have a far-reaching impact on the steel market

the central economic work conference will be held in Beijing from December 18 to 20. Judging from the press release of the meeting, it continues the spirit of the Politburo meeting on December 8. Reviewed the achievements of economic work since the 18th CPC National Congress and deployed the economic work in 2018. In terms of the impact on the steel industry, the author believes that there are several points worth paying attention to: first, the conference release deleted the previous statement of "moderately expanding total demand" for two consecutive years, and pointed out that China has shifted from the stage of high-speed growth to the stage of high-quality development. It means that the government has no longer simply pursued economic growth, and its focus has shifted from stable growth to the pursuit of quality and structural adjustment; Second, the meeting made it clear that three major battles should be won in the next three years: prevention and resolution of major risks, schematic diagram of material impact in Jingtu 3 environmental room, quasi poverty alleviation and pollution prevention. In order to continue to significantly reduce the total discharge of major pollutants and improve the overall quality of the ecological environment, environmental protection and production restriction may become the norm in the later stage; Third, we will implement a proactive fiscal policy and a prudent monetary policy. A prudent monetary policy should remain neutral, control the general gate of money supply, and tighten marginally. Fourth, accelerate the reform of the housing system and the construction of long-term mechanisms: first, develop the rental market; Second, maintain the continuity and stability of real estate regulation policies; Third, distinguish between the central and local powers and implement differentiated regulation

On December 29, the central bank said that the total liquidity of the banking system was currently at a high level, fiscal expenditure at the end of the year was further increased, and the total liquidity of the banking system would continue to be pushed up after hedging against factors such as the maturity of the central bank's reverse repurchase. Open market operations were not carried out on that day, which was the sixth consecutive day of suspension of open market operations. It is worth mentioning that the RMB loans issued to the real economy in November increased by 1.14 trillion yuan, an increase of 296.5 billion yuan year-on-year, indicating that the effect of funds "getting rid of the virtual to the real" is significant. The monetary policy of the Central Bank of China will not be significantly tightened

to sum up, after the continuous sharp decline since the middle and late December, the current north-south price difference, current price difference and snail price difference in the domestic market have been gradually corrected to a reasonable level, and the market risk has been significantly released. However, at present, spot steel prices and steel mill profits are still at a high level, and merchants' expectations for the future market are not high. In January, under the condition of further shrinking terminal demand, steel mill prices are still to be further reduced to stimulate merchants' enthusiasm for winter storage. It is expected that the domestic steel price in January will gradually stop falling, first suppress and then increase

Copyright © 2011 JIN SHI