On September 9, the domestic steel market strengthened, and the ex factory price of Tangshan ordinary square billet increased by 50 to 5170 yuan / ton. Today, the black futures market generally rose, the downstream demand was obviously released, the speculative demand was active, the steel inventory decreased rapidly, and the traders were optimistic.
Steel spot market
Construction Steel: On September 9, the average price of 20mm Class III seismic rebar in 31 major cities across the country was 5,462 yuan/ton($853/ton), an increase of 50 yuan/ton($7.8/ton) from the previous trading day. Due to the impact of the limitation of production by government policy, steel mills in various regions frequently cut production and overhaul, the output of building materials continues decline, and short-term resource supply is limited. In terms of demand, after entering September, market demand has been steadily released, the speed of destocking has further accelerated, and the supply and demand pattern has gradually shifted from a weak balance to a tight state.
Hot-rolled coils: On September 9, the average price of 4.75mm hot-rolled coils in 24 major cities of China was 5,822 yuan/ton($909/ton), an increase of 24 yuan/ton(3.75$/ton) from the previous trading day.
Cold rolled coil: On September 9, the average price of 1.0mm cold coil in 24 major cities across the country was 6523 yuan/ton($1019/ton), an increase of 1 yuan/ton(0.16$) from the previous trading day. Today, the market transactions in many places are good, fundamental data are good, traders mostly focus on selling, market is busy, and downstream purchases are active.
Raw material spot market
Imported ore: On September 9, the spot market for imported iron ore was weak and fluctuating, and the market sentiment was weak.
Scrap steel: On September 9, the average price of scrap steel in 45 major markets of China was 3357 yuan/ton($524/ton), an increase of 6 yuan/ton from the previous trading day.
Supply and demand of steel market
On the supply side: the output of the "5 series steel products" (5 series steel products：steel rod, shaped steel, steel sheet, steel pipe, metal) this Friday was 10.152 million tons, a decrease of 9700 tons on a week-on-week basis. Among them, the output of rebar was 3,272,300 tons, a decrease of 73,600 tons on a week-on-month basis; the output of hot-rolled coils was 3,188,300 tons, an increase of 41,800 tons on a week-on-month basis.
In terms of demand: the apparent consumption of the "5 series steel products" this Friday was 10.706 million tons, an increase of 291,800 tons on a week-on-week basis.
In terms of inventory: total steel inventory was 20.24 million tons this week, a week-on-week decrease of 553,100 tons. Among them, the stock of steel mills was 5,956,600 tons, which was a decrease of 255,000 tons on a week-on-week basis; the social inventory was 14,283,400 tons, which was a decrease of 298,100 tons on a week-on-week basis.
September was in the peak demand season, coupled with the push up of the futures market, active downstream terminal purchases, and active speculative demand, steel demand rebounded significantly this week. At the same time, many steel mills in China overhauled and reduced production, and output was still suppressed. On the whole, this week the steel market's supply and demand fundamentals are biased, and inventories have accelerated.
Win Road International Steel Products
Post time: Sep-10-2021