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Steel market overall rise in many varieties hit a new high nearly 10

Steel market overall rise in many varieties hit a new high nearly 10

2021-05-12

Since the festival, the steel market as a whole industry has risen in an all-round way, a number of varieties of goods is set nearly 10 new high prices.According to data, as of May 11, steel mining industry chain, spot price, iron ore up 49.19%, billet up 46.75%, rebar up 34.9%, wire up 36.11%, hot rolled plate coil up 46.87%, seamless pipe up 26.87%, stainless steel plate up 5.89%, profile overall up 5.69%.

Analysis of the main reasons for the steel market price rise are:

First, the current macro environment is still the continuation of last year's inflation logic, all major blocks of bulk commodities in the overall trend of a substantial rise;

Second, the theme of "carbon neutral, carbon peak" of environmental protection limit production continues to deepen, the production of crude steel at the industrial level continues to carry out.May 10, the National Development and Reform Commission, the Ministry of Industry and Information Technology is organizing the national steel overcapacity "look back" and crude steel production reduction work, the steel industry to reduce overcapacity trend unchanged;

Third, on May 6, the National Development and Reform Commission issued a statement on indefinitely suspending all activities under the mechanism of China-Australia Strategic Economic Dialogue. The tension between China and Australia caused new factors to affect the import of iron ore which had previously been reduced in supply.Fourth, because the foreign steel purchase price is high, the domestic steel export situation is good, in the industry under the premise of limited production, but also to the domestic prices form a strong boost.

Here's a look at the short-term trend:

Macroscopically, due to the influence of international factors, the environment of loose liquidity will not change in the short term, and the short-term mismatch between supply and demand caused by the global economic recovery and monetary easing, the global bulk commodities are still in the overall trend of a sharp rise. As a representative variety of bulk commodities, the price of steel is naturally prone to rise rather than fall.

Supply and demand, the supply side because of the carbon peak production limit policy impact, steel production is bound to be effectively controlled, and the Ministry of Industry and Information Technology also clearly put forward 21 years to make steel production year-on-year decline, Tangshan and other places due to environmental protection limit production has appeared a significant decline in production. Crude steel production reduction, supply contraction will obviously further push up steel prices;Demand side, the first quarter due to foreign economic recovery, steel demand growth, resulting in a large gap between domestic and foreign steel prices. Under the premise of steel production limit, foreign demand also led to a surge in domestic terminal inventory sentiment, and on May 1, steel products export tax rebate policy adjustment officially landed, domestic trade demand will therefore increase, demand or sustained growth. The fundamentals of supply and demand have changed a lot, the fundamentals of demand for contraction, steel prices to maintain a strong.

On the market, because the domestic terminal replenishment sentiment was driven, terminal actual demand superimposed speculative storage replenishment, panic buying atmosphere is strong, the spot market rose continuously. Futures, rebar, hot coil period spot prices have reached a record high, market sentiment is too hot. However, the ever-increasing spot price makes the downstream bear greater operating pressure, and some downstream enterprises that are difficult to effectively conduct raw material costs will enter a state of no profit or even loss. In the short term, replenishing inventory on demand will become the normal procurement operation of the downstream.

To sum up, analysts believe that the shape of the raw materials high end will continue in the short term, superposition cut supplies, iron and steel industry demand growth fundamentals, the short-term spot price of iron and steel industry will continue to maintain high and volatile, but after the rapid rise, the callback risk accumulation, need to pay more attention to the spot production and inventory.

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