May steel factory resurgent steel measures into focus

Just entering the second trading week in May, the nationwide spiral price has risen to a completely new segment. As of the 14th, North China's general line was 3680 yuan/ton, high-line 3700 yuan/ton, secondary large-size rebar 3630 yuan/ton, and 3 large-size rebar 3790 yuan/ton, which was more than the cumulative price on April 30. The price rose by 120-150 yuan/ton, and the plate price also rose by 100-150 yuan/ton. East China and South China also had the same upward trend. Among them, the market price of small-sized rebar and Shanghai market wire rods in the Beijing market was particularly alarming, with a cumulative increase of RMB 400/ton. [Blue Whale Steel Studio] believes that due to the rapid rise in steel prices after May 1st, the steel mills that were originally close to the market in mid-April to determine the prices of steel mills in May fell into “sweet pain” because On the other hand, faced with the huge price difference between steel factory prices and market prices, steel mills had to start reexamining their sales. Strategy.
First, the supporting factors for the rise of steel prices in May are quite numerous.
At present, especially in the context of the country clearly indicating that it is necessary to limit the export of low-end steel products, the analysis of the factors of the sharp rise in steel prices is particularly important.
1. From the perspective of apparent resources, the most prominent manifestation is the apparent decrease in social stocks.
Analyzed from the data listed in the table and in the chart, the firmness of the current market price is due to the fact that most of the stocks accumulated during the Spring Festival were quickly digested in March-April, and the rate of decline in stocks was very fast, in the most recent 12 months. The speed of inventory decline during the period of March to May this year is undoubtedly the fastest, which has become the main reason for the reversal of supply and demand of market resources.
2, from the long-term price trend of long products, it forms a clear difference with the price trend of flat products.
In terms of long products, the domestic long products market after the “May 1st” holiday continued to prosper, and all major steel markets showed upward trend. Among them, the price of the general line in North China has advanced by leaps and bounds, rising to RMB 3,650/t in one fell swoop, which is almost the same as the price of the high line. In the previous long period of time, the price of the common line was about RMB 70-100/t lower than the price of the high line. The high-line market price was 3,670 yuan/ton, which was a cumulative increase of 150 yuan/ton from the end of April. The price of secondary thread also climbed to RMB 3,630/ton, which was a cumulative increase of RMB 120/ton over the end of April. The price of tertiary thread was RMB 3,700/ton, and the increase range was RMB 160/ton. The price of long products in East China has increased more than in North China. As of Friday, the high prices have easily exceeded the 3900 yuan/ton mark, and the cumulative increase has reached 350 yuan/ton. The increase in the price of thread is slightly smaller, but it is also around 180 yuan/ton. The situation of long products in South China is similar to that in East China. The increase of wire rod is close to RMB 300/ton, and the increase of thread is RMB 90-140/ton. Northwest, Northeast, and Southwest have similar trends.

In flat products, thin plate products continue to be low, apart from the increase in plate prices. The price of 16-25mmq235b plate in North China reached 4150-4250 yuan/ton, the cumulative price increase was about 100 yuan/ton, and the special steel plate also had the same rising rate. The same species in East China, Northwest China, and Northeast China witnessed a cumulative increase of RMB 100/ton, and South China increased by RMB 150-180/ton. In terms of thin plates, cold and hot sheets in major domestic markets continued to remain stable, while galvanized sheets declined. Among them, the price of 3.0mm hot-rolled sheet and 1.0mm cold-rolled sheet in North China was about 4,150 yuan/ton and 5,050 yuan/ton, respectively, and the galvanized sheet was slightly decreased, down by 50 yuan/ton; the same specifications of hot-rolled sheet in eastern China The price of cold-rolled sheet was about RMB 4300/tonne and RMB 5050/tonne respectively, and that of galvanized sheet was also reduced by RMB 70/ton; the price of hot-rolled sheet and cold-rolled sheet of the same specifications in South China was RMB 4300/tonne respectively. 5180 yuan / ton, galvanized sheet fell 70 yuan / ton. Blue Whale Steel Studio believes that the main reason for the steel market's performance is that flat steel prices have risen first and the magnitude is relatively large, and the flat steel stocks are not as optimistic as long products.
3. The significant increase in exports of steel products has also provided impetus for the rise in the price of steel resources in the domestic market.
According to the statistics of the Steel Association, 58% of the newly added domestic steel resources are used for exports, and only 42% of resources are left to be digested domestically. The latest statistics show that in April, 7.16 million tons of steel were exported nationwide, an increase of 1.65 times year-on-year; 870,000 tons of steel billets were exported, an increase of 81% year-on-year. 1.63 million tons of imported steel, 20,000 tons of imported steel billet, and 6.38 million tons of net export billet, an increase of 54.5% year-on-year. From a ring perspective, the nation’s steel exports in March increased by 33% from the previous month, while exports of steel billets increased by 31.8% from the previous month. If it is assumed that the export speed will be maintained evenly, the total steel exports from January to April will be calculated and the steel export volume will reach 60 million tons or more this year. Such large-scale export growth has greatly stimulated the improvement of supply and demand in the domestic market.
4. Although it is true that the price of long products in the May market in Beijing in May of the 5th regular meeting of the North China Steel Group is somewhat conservative, the prudent price operation of steel products still leaves sufficient room for the price operation in May-June.
The price of wire rod and secondary large-size thread was increased by RMB130/ton in the “May 5 Steel” policy in May, and the price of large-size three-grade thread was increased by RMB 150/ton. The price of second- and third-order small-size thread was increased. 180 yuan/ton. It should be said that such a price policy has played a more crucial guiding role for the later market, especially the North China market.
5. The rising cost of raw materials for steel products also forms a support factor for the rise in steel prices.
On April 22, China's "Coke OPEC" coking coalition was established in Shanxi, and 212 coking companies in the four provinces of Shanxi, Shanxi, Shandong and Shaanxi became the first members. The first thing after the alliance was established is to announce that the price of coke will increase by 120-150 yuan/ton from May 1. Steel mills apparently have no power to negotiate and have no choice but to accept. However, it is awful that the prices of main coking coal, fat coal, lean coal, gas coal, thermal coal, and weakly bonded coal in the coal sector have also been increased by 20-40 yuan/ton.
The chain reaction that the steelmakers are worried about is not over yet. The price of iron ore and the price of pig iron and scrap steel are also rising. At present, the purchase price of steel mills in Hebei has reached 850-870 yuan/ton, and the cumulative increase rate is 40-60 yuan. /Ton. In addition, the price of ferroalloys and other charge materials also saw a significant increase. Billet prices have also risen sharply. Up to now, the price of carbon billet in North China has reached 3,300 yuan/ton, and the price of low-alloy billet has risen to 3,380 yuan/ton, which is a cumulative increase of 200 yuan/ton from the end of April. It is expected that the prices of scrap, pig iron, fine iron powder and secondary metallurgical coke will continue to rise.


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