I. Steel futures market prices
On May 11, the domestic steel market fell weakly, Tangshan Qian’an Pu square billet factory taxed down 40 reported 3430 yuan / ton. Price screw continued to weaken adjustment, while the April financial data, performance is less than expected, the market mentality turned weak, spot prices continue to kill, just poor transactions.
May 11, the main futures snail shock weakened, closing at 3600 down 2.65%, DIF and DEA tend to parallel, RSI three-line indicator is located at 28-35, running in the upper part of the lower track of the Bollinger band.
On May 11, seven domestic steel mills cut the ex-factory price of construction steel by 30-100 yuan/ton. Among them, Shagang cut the ex-factory price of rebar by RMB100/ton in mid-May.
II. Four major varieties of steel market prices
Construction steel: On May 11, the average price of 20mm Grade 3 seismic rebar in 31 major cities nationwide was RMB 3,812 per tonne, down RMB 37 per tonne from the previous trading day. In the short term, the recent market negative news is frequent, or will have some disturbance to the spot price. It is expected that domestic construction steel prices will continue to weaken on the 12th.
Hot rolled coil: May 11, the national 24 major cities 4.75mm hot rolled coil average price of 3876 yuan / ton, down 58 yuan / ton compared with the previous trading day. 11 market trading atmosphere is cold, merchants shipping sentiment is low, the downstream terminal is cautious wait-and-see attitude, the market uncertainty is strong. To sum up, it is expected that the price of hot coil market will be weak on the 12th.
Cold rolled coil: May 11, the national 24 major cities 1.0mm cold coil average price of 4524 yuan / ton, down 22 yuan / ton compared to the previous trading day. 11 market prices continue to weaken, the market trading atmosphere is cold, the spot transaction is relatively weak. In terms of operation, the current downstream demand has not yet significantly improved, the merchants on the late price is expected to confidence is clearly insufficient, the operation is still to reduce the library shipments. From a comprehensive point of view, it is expected that the 12 cold rolled prices will be narrowly oscillating operation.
The average price of 20mm general plate in 24 major cities was 4239 yuan/ton on May 11, down 33 yuan/ton compared with the previous trading day. 11 black system futures pan shocks lower, the market atmosphere is cold, the overall transaction is weak. According to market feedback, the current news on crude steel production flat control has been basically digested by the market, market prices around the return to rational, raw material costs for the negative feedback of finished materials is still not over, the spot price support is weak, the downstream terminal purchasing enthusiasm is poor, cautious wait and see. From a comprehensive point of view, it is expected that the 12 domestic thick plate price shocks tend to run weakly.
III. Raw fuel market prices
Imported ore: On May 11, the market price of mainstream imported iron ore varieties at Shandong port was shockingly downward. Traders are generally positive, and the offer is mainly on the basis of the market, traders speculative demand is poor, the far month market trading sentiment is still okay, there are PB powder transactions at the end of July; individual steel mills bidding in the low grade powder ore, most steel mills wait and see, less inquiries. At present, the mainstream PB powder is at 770-775; the mainstream super special powder is at 645-650; the mainstream card powder is at 860-865; the mainstream PB block is at 885-890. (Unit: yuan/wet ton)
Coke: On May 11, the coke market was running weakly. With the coke purchase prices of mainstream steel mills in Hebei and Shandong dropping by RMB100/ton on the 10th, the seventh round of coke price cuts landed in full force, with the current coke prices dropping by RMB600-700/ton cumulatively. Most of the coke enterprises still maintain their previous production restrictions, and coke production is relatively stable, but the downstream enthusiasm to take goods is low, and coke plant shipments are restricted, with a tendency to continue to accumulate storage. Steel mills are still cautious about coke purchases due to the weak steel price shocks.
Steel scrap: On May 11, the average price of steel scrap in 45 major markets across the country was RMB 2,429 per tonne, down RMB 4 per tonne from the previous trading day. At the beginning of the week, the futures overshoot rebound, steel mills in southern China after the scrap purchase price has improved arrival, basically to meet the daily consumption needs of steel mills, but taking into account that steel demand is still sluggish, steel mill losses still exist, so the scrap price upward support still has a certain weakening effect. East China steel mills with the weakening of the current price of finished steel futures, some steel mills to stop the purchase price back down, the procurement sentiment turned cautiously biased. In addition, as steel prices fall back, merchants are generally bearish on the market, the base operation more to fast in and fast out. From a comprehensive point of view, the recent cost of iron continues to decline, scrap steel suffered a shock, coupled with the continued weakness of steel prices, scrap steel bottom support is not enough, therefore, is expected to 12 scrap steel prices stable in weak operation.
Fourth, the steel market price forecast
Macro: China’s April new RMB loans 718.8 billion yuan, estimated at 1.4 trillion yuan, the previous value of 3.89 billion yuan. April new credit is less than expected, especially long-term loans to residents decreased by 115.6 billion yuan, indicating that the real estate market recovery is weak.
Supply side: According to Mysteel research, the five major varieties of steel production this week was 9,226,600 tonnes, down 182,700 tonnes week-on-week. Among them, the output of rebar, wire rod, hot rolled coil and cold rolled coil decreased by 49,500 tons, 58,700 tons, 54,300 tons and 24,100 tons respectively; the output of medium thick plate increased by 0.39 million tons.
Inventory: This week, the total steel inventory amounted to 18,726,800 tons, a decrease of 846,200 tons week-on-week. Among them, the steel mill inventory amounted to 5,422,300 tons, down 40,400 tons week-on-week; the social inventory amounted to 13,304,500 tons, down 445,800 tons week-on-week.
In the first half of the week, driven by the oversold rebound in black futures, downstream concentrated on replenishment, promoting the steel market volume and price, steel inventories fell significantly. However, the good times did not last long, due to the slow progress of housing construction plus the southern comprehensive into the flood season, the lack of demand toughness. At the same time, the mainstream steel mills to reduce the price of storage, raw fuel prices continue to run under pressure, market sentiment has once again turned weak, the second half of the week steel futures market pullback.
In the short term, the market uncertainties are more, long and short game fierce. On the one hand, steel mills continue to reduce production, which is conducive to alleviating the contradiction between supply and demand. On the other hand, with the domestic gradually into the high temperature and rainy weather, demand is still expected to weaken, the contradiction between supply and demand is difficult to materially reverse for the time being, the cost also has the space to move down. In the steel inventory continues to fall faster before the market confidence is difficult to effectively restore, short-term steel prices or weak shock run.
MORE NEWS OF STEEL MARKRT IN CHINA, FOLLOW ME.
