CHINA STEEL NEWS – REPORT ON CHINA’S STEEL MARKET – China Steel prices continue to rising.

Billet soared 70CNY,Futures steel breaks through 5400CNY,Steel prices continue to rising.

• On 7^st.July , the domestic steel market rose strongly, and the ex-factory price of Tangshan billet rose by 70CNY to 5,000CNY per ton.
• This week, the steel market transactions improved significantly, the downstream centralized replenishment, and speculative demand rebounded.

• On the 7^St, the black futures market was strong and weak. The main force of snails closed at 5439CNY per ton, up 3.34% from the previous trading day.
• DIF and DEA went up in parallel, and the RSI third-line indicator was at 58-85, running above the upper rail of the Bollinger Band.

• On the 7^St, 17 steel mills across the country raised the ex-factory price of construction steel by RMB 20-100 pre ton.

Raw material spot market:

Coke:

• On 07^St July, the coke market was temporarily operating steadily, and the price of coke was in a dilemma. The market was in a wait-and-see state.
• On the supply side, most of the coke companies in the main producing areas have resumed normal production, and the steel mills are currently purchasing according to demand, and overall supply and demand are in balance.
• Steel mills are currently in a low profit position and are in the off-season for sales. The mentality of lowering prices is strong, and coke prices have room to fall.
• From a regional perspective, due to the impact of environmental protection inspections, Shandong coke companies have recently started to decline, and some coke companies have limited production by 10%-20%. Some coke companies have limited production due to capacity compliance issues, reaching 40%-60%. 
• In the future, we need to continue to pay attention to the implementation of Shandong’s policy of fixing coke with steel. If this policy is implemented, later inspections will become stricter, and the impact on the coke supply in eastern China will continue to expand.

Scrap steel:

• On 07^St July, the scrap market price stabilized. The average scrap price in 45 major markets across the country was 3,209 CNY/Mt, an increase of 2 CNY/Mt from the previous trading day. The mainstream steel mill scrap prices continued to stabilize.
• Futures rebar has risen again. Affected by the news of domestic restrictions on production, the number of steel mills’ overhauls has also increased significantly recently. The prices of finished steel products will be adjusted to increase prices as a whole this week.

Steel market forecast:

• According to 237 distributors monitored by China Steel Net, the transaction volume of building materials on July 5 and 6 was 262,000 tons and 218,000 tons, respectively, which was significantly higher than the average daily level of 170,000 tons last week.
• Although the output of steel mills has also rebounded from last week, considering the losses of some companies, it is expected that the supply recovery will be slower than the demand. This week, steel inventories are expected to decline, supporting the strengthening of steel prices.
• However, it is still in the traditional off-season for consumption. After several consecutive days of rising, once the willingness of downstream replenishment weakens, the increase in steel prices may slow down in the second half of the week.