On September 6, the domestic steel market price mostly rose, and the ex-factory price of Tangshan ordinary billet rose by 20yuan(3.1usd) to 5,100 yuan/ton (796USD/Ton).
On the 6th, the coke and ore futures rose strongly, and the main contracts for coke and coking coal hit a record high, while the main contracts for iron ore fell sharply and hit a 15-month low.
On the 6th, 12 domestic steel mills raised the ex-factory price of construction steel by RMB 20-70/ton(11USD).
Steel Spot Market
Construction Steel: On September 6, the average price of 20mm Class III seismic rebar in 31 major cities of China was 5392 yuan/ton(842usd/ton), an increase of 35 yuan/ton(5.5usd) from the previous trading day. In the short term, recent news about environmental protection production restrictions in Handan, Jiangsu and Guangdong, Guangdong and other regions have been frequently released. With the supply-side contraction expected superimposed news boosted, the market is bullish. In the short term, with the gradual release of demand, the fundamentals of supply and demand continue to improve.
Hot-rolled coils: On September 6, the average price of 4.75mm hot-rolled coils in 24 major cities of China was 5,797 yuan/ton(905usd/ton), an increase of 14 yuan/ton(2.2usd) from the previous trading day. In September, the northern steel mills increased their overhauls, and the steel mills’ orders were significantly discounted. This led to a decrease in the amount of resources of Beimao’s southward movement. News of limited production in various regions and dual control of energy consumption appeared. Speeding up, supply has also declined, and the overall fundamentals of hot rolling are acceptable.
Cold rolled coil: On September 6, the average price of 1.0mm cold coil in 24 major cities across the country was 6,516 yuan/ton(1018usd/ton), an increase of 6 yuan/ton(0.94usd) from the previous trading day. According to market feedback, the price of cold-rolled rolled products fluctuated upward, supported by the stronger volatility of hot coil futures today, but the space is very limited. It is reported that the mood of many places has risen today, mostly based on transactions, and the market's mutual replenishment sentiment is general. The downstream industries mostly purchase on demand after replenishment last week.
Raw Material Spot Market
Imported ore: On September 6, the spot market price of imported iron ore fell .
Coke: On September 6, the coke market was on the strong side, and the ninth round of prices was fully implemented. At present, coking production restrictions in Shandong are becoming stricter. In Jining, Heze, Tai'an and other places, coking companies have stopped production, and the remaining coking companies have reduced production to varying degrees, ranging from 30-50%. The coke supply has dropped significantly compared with the previous period. The market has tightened expectations for Shandong Coking's production restrictions; most of the coking companies in Shanxi are actively restricting production. Downstream steel mills have reduced production requirements for crude steel, and some steel mills’ blast furnaces have also reduced production. At present, there is no large-scale centralized production restriction. The demand for coke is slowly declining. The current coke supply and demand market is currently tight. Coke's cumulative increase of 1160 yuan/ton profit is the main factor due to raw material end squeezing, and the contradiction between supply and demand is a secondary factor. The profit of the current steel mills has fallen from the previous high, which has been in conflict with frequent price hikes. It is necessary to guard against the risk of market corrections.
Scrap steel: On September 6, the average price of scrap steel in 45 major markets across the country was 3344 yuan/ton(522usd/ton), an increase of 7 yuan/ton(1.1usd) from the previous trading day. At present, most merchants are focusing on fast-in and fast-out, and the willingness of individual merchants to ship goods has weakened and is optimistic about the market outlook. Downstream demand is recovering, the supply and demand situation is showing a trend of positive development, and the price of building materials is firm to provide support for scrap prices. The overall profit of steel mills has rebounded, and the tightening of scrap resources is good for scrap prices.
Supply And Demand Of Steel Market
In August, the average daily crude steel output of key steel enterprises was 2.0996 million tons, a decrease of 2.06% from the previous month. As some areas are still affected by environmental protection and power curtailment, it is expected that steel production will rebound slowly in the first half of September. At the same time, the domestic downstream construction situation has improved, but in the face of the pressure of rising prices of raw materials, the performance of steel demand has not been stable. In the short term, the overall preference of the steel market's supply and demand fundamentals.
Win Road International Steel Product
Post time: Sep-07-2021