This week, the mainstream price of the spot market fluctuated but in a rising trend. The overall market performance in the first half of the week was stable. Some areas were affected by lower-than-expected transaction releases, and prices were slightly loosened. After the middle of the week, with the strength of raw materials and futures, the news of superimposed production restrictions continued to ferment, and market quotations rose sharply.
Steel Express on the 12th
[Common billet] In early trading, the billet ex-works in Qian'an area remained stable at 5200yuan/ton($812/ton) compared with yesterday.
[Section steel] Section steel prices are steadily increasing. Now mainstream steel mills are quoting I-beam 5520yuan/ton($862/ton), angle steel 5480-5490/ton($856-857/ton), channel steel 5480-5500, the market has picked up slightly, and some low-priced resources have generally traded in general. Rolling mills continue to implement production suspension restrictions.
[Steel Strip] The mainstream 145mm strip steel opened at the opening of the market fell by 20-50yuan/ton($3-8/ton), and the overall transaction was good, some of it was cleared, and the intraday rose by 20-30, now Guoyi 5570yuan/ton EXW($870/ton).
The market price of Tangshan 355mm strip steel rose by 20-30yuan/ton($3-5/ton) compared with yesterday, and the mainstream spot price was 5750-5760yuan/ton($898-900/ton).
[Steel Pipe] Round pipe: Welded pipe and galvanized pipe have stable prices. 4-inch new national standard hot-dip galvanized pipe, 6450yuan/ton($1007/ton); 4-inch welded pipe 5940($928/ton), weighing includes tax. Square tube:rectangular tube, hot-dip galvanized rectangular tube price is stable, 50 square rectangular tube quoted 5700yuan/ton($890/ton); hot-dip galvanized rectangular tube 50 square quoted 6280($981/ton). Scaffolding tube: scaffold tube ex-factory price drops by 30yuan/ton to 5660-5760yuan/ton($884-900/ton), cash includes tax, and the transaction is average.
【Hot Roll Coil】Market prices remain stable, 1500mm wide flat flat Steel 5820yuan/ton($909/ton), Kaiping 5960($931/ton), including tax.
[Building materials] Construction steel market prices are temporarily stable, with three-level small thread 5550yuan/ton($867/ton), three-level large thread 5360yuan/ton(837/ton), wire rod 5660yuan/ton($884/ton).
[Steel billet] The general billet resources will be increased by 20yuan/ton, including tax, to 5220 yuan/ton($815/ton).
Inventory of China's steel market
Construction steel: The price of construction steel across the country rose sharply this week. The main reason is that under the background of "dual energy consumption control", production restrictions have been tightened again in various regions. In particular, the frequent news of maintenance and production reductions of steel plants in the Jiangsu region has promoted market transactions. Investing in sentiment, the snails continue to rise. Terminal and market demand were actively released, and prices in various regions rose significantly. In addition, the inventory data released on our website this week showed that the output decreased slightly under the background of production restriction; the continuous improvement in demand caused both the factory and social libraries to decline, and the demand for watches increased considerably. The whole week showed a significant upward trend.
From the perspective of supply: at present, the increase in overhauls and production reductions in Jiangsu and Zhejiang regional steel mills this week has raised the market’s expectations of continued increase in the leveling control policy. The small blast furnace was shut down until the large blast furnace was gradually shut down. This series of strict control processes gradually became prominent in the data. In comparison with last year's supply of various varieties, rebar is also the most affected variety. Judging from the supply forecast for next week, the supply will continue to be tight, with limited room for upside, and the overall output will remain at a low level.
In terms of demand: Judging from recent transaction volume data, demand has gradually improved since late August, and the desire for terminal and speculative demand has increased significantly. In addition, the National Development and Reform Commission said this week that it will guide and urge local governments to promptly complete the preparatory work for projects that plan to issue special bonds in the next few months of this year, and promote the construction of projects as soon as possible after the issuance of special bonds. At the same time, we will accelerate the advancement of the preliminary work of the project, and strive for the early issuance and use of special bonds next year, and the early formation of physical workloads. Ensure that the special bonds are used in compliance with regulations, and may not be used for land reserve projects, industrial projects, real estate development projects, and building projects other than the construction of leased houses. The acceleration of later infrastructure projects will bring support to demand.
From a mentality point of view: this week, production restrictions in Jiangsu are frequent. The steel mills that have been overhauled have continued to tighten under the background of "dual energy consumption control". In addition, other regions have also announced maintenance and production reduction news, and the market is expected to increase production restrictions. In addition, as the market demand has been steadily changing for the better, the outlook for bullish confidence has increased; the increase in steel mills’ overhaul and production cuts has also strengthened the bottom support of resource prices.
Hot-rolled coil: domestic hot-rolled coil market prices fluctuated upward this week.
Plate: The price of plate has risen sharply across the country this week. In terms of price: the overall fluctuation range is 40-100 yuan/ton, of which the overall rebound in East China is relatively high.
Cold-rolled coil: This week, the national cold-rolled price fluctuated upward, and the market transactions were average. From a fundamental point of view, the production of cold-rolled rolling has decreased significantly on a week-on-week basis, and both the factory warehouse and the social warehouse have declined. In terms of the market, entering the "Golden September", the market mentality has slightly improved. Merchants mostly maintain shipments. The market volume has increased slightly during the market transaction week. Downstream procurement mostly purchases on demand, and it will take time for the full release of production capacity.
For next week: On the supply side, the recent overhaul of blast furnaces in local steel mills has led to a reduction in the supply of hot-rolled C material. The actual supply of cold-rolled materials will be affected to a certain extent. It is expected that the cold-rolled supply will decrease slightly this month; "Chip" will not improve significantly. The home appliance industry is basically maintained, and the peak season of the traditional processing industry may be released to a certain extent; Market mentality: In the traditional peak season, the information aspect of the week and the overall benefit of the electronic disk are good for the market. Merchants are mostly optimistic about the market outlook.
Seamless pipes: The national price of seamless pipes continued to grow stronger this week. In terms of price: As of September 10, the average price of 108*4.5mm seamless pipes in 27 major cities across the country was 6423 yuan/ton, an increase of 109 yuan/ton from last week. Prices in most cities across the country rose by 100-150 yuan/ton this week. In terms of inventory: The seamless pipe inventory in major cities across the country was 755,900 tons, an increase of 4,900 tons from last week, a month-on-month increase of 5,300 tons, and a year-on-year decrease of 33,800 tons.
Welded pipe: This week, the domestic welded pipe market prices have strengthened and the inventory has increased.
For next week: 1. The black futures fluctuated upwards this week, driving the price of raw materials to rise, and the quotations of pipe factories rose. 2. From the perspective of the market, this week's traders' quotations were mostly passively raised, but the market spot price is still close to the cost of delivery, and merchants tend to move more in volume. 3. The market price increase has increased terminal wait-and-see sentiment, but the cost is underpinned, and the market price of welded pipe is likely to rise but hardly fall.
Predict next week
On the whole, the domestic steel market price volatility has become stronger this week. At this stage, with the release of news of production cuts in various markets, the market’s expectations for the current reduction in crude steel have increased, which has played a certain role in supporting the market. On the other hand, although the demand performance is not as good as expected at this stage and the "Golden Nine" effect is not obvious, under the circumstance of gradual improvement in prices, there is a slight increase in market demand compared with the previous period, the total amount of social treasury continues to decrease, and short-term resource pressure is not great. On the other hand, although the market is still cautious and wait-and-see attitude towards demand expectations at this stage, considering that the time is about to enter mid-September, even if the incremental part is not much, considering the cost factor, there is still a short-term price increase. thrust.
Post time: Sep-13-2021