Steel mills have raised prices on a large scale, and short-term steel prices may fluctuate strongly.
- ABSTRACT: On November 25, the domestic steel market generally rose, and the ex-factory price of Tangshan Pu’s billet remained stable at 4,320 cny/ton. Driven by the rise in night trading futures, most of the domestic construction steel prices rose in the morning. From the perspective of transactions, the continuous rise in the last few days has caused the downstream not to buy, high transactions are obviously blocked, speculative demand is less, and market transactions are weak.
On the 25th,NOV, the main force of futures opened and oscillated. The closing price of 4255 rose by 2.55%. DIF and DEA went up in both directions, and the RSI three-line indicator was located at 44-69, running between the middle track and the upper track of the Bollinger Band.
Steel spot market:
- Construction steel: On November 25, the average price of 20mm three-level seismic rebar in 31 major cities across the country was 4,820 cny/ton, an increase of 27 cny/ton from the previous trading day. Recently, the production of rebar has rebounded slightly, and both the factory and social warehouses have declined. At the same time, the apparent consumption has rebounded slightly, but it is still significantly lower than the same period last year. In the short term, although the fundamentals of rebar have improved to some extent, as the weather turns colder, there is still room for demand to fall. In the near future, we need to pay more attention to the release intensity of terminal demand after the price rebound. Fortunately, the frequent news of production restrictions in the north has boosted market confidence to a certain extent. Therefore, it is expected that domestic construction steel prices may continue to strengthen on the 26th.
- Hot-rolled coil: On November 25, the average price of 4.75mm hot-rolled coil in 24 major cities across the country was 4,825 cny/ton, an increase of 27 cny/ton from the previous trading day. Various indicators of hot-rolled coils have performed well this week. Weekly output and social warehouses have all declined, while factories and warehouses have increased. The market is enthusiastic about reducing warehouses, and some materials and specifications are out of stock. In general, market sentiment has improved slightly in the past two days as the market has risen. After experiencing continuous sharp declines, merchants have a strong desire to increase prices, but at the same time, they have a strong desire to reduce inventory. It is expected that they will be ideal and realistic in the near future. In the game. On the whole, the national hot-rolled coil market is expected to fluctuate strongly on the 26th.
- Cold rolled coil: On November 25, the average price of 1.0mm cold coil in 24 major cities across the country was 5518 cny/ton, an increase of 13 cny/ton from the previous trading day. Towards the end of the month, major steel mills have successively introduced November settlement prices. Some merchants have room for negotiation of transaction prices in order to ship goods. In terms of inventory, according to Mysteel’s incomplete statistics, the current cold-rolled steel mill inventory is 346,800 tons, an increase of 5,200 tons on a week-on-month basis, and social inventory is 1.224 million tons, which is a decrease of 3 million tons on a week-on-month basis. Ton. Therefore, it is expected that the domestic cold-rolled spot price on the 26th may be weak and stable.
- Plate: On November 25, the average price of 20mm general-purpose plates in 24 major cities across the country was 5158 cny/ton, an increase of 22 cny/ton from the previous trading day. According to Mysteel’s weekly production and inventory data, the production of medium plates increased this week, and the increase in community warehouses and the increase in factory warehouses. Sales pressure continued to shift to steel mills. The current coil price difference is about 340 yuan/ton, which is lower than the normal price difference. High, steel mills have a high willingness to produce medium plates. At the same time, agents have a strong sense of risk aversion and less replenishment. On the whole, market demand is still in the off-season, and the price of plate will remain volatile and stable in the short term, and then it is more likely to continue to fall.
Raw material spot market:
- Imported ore: On November 25, the imported iron ore market in Shandong fluctuated upwards, the market sentiment was quiet, and there were fewer transactions. As of press time, some transactions in the market have been investigated: Qingdao Port: Super special flour 440 cny / ton; Lanshan Port: Card flour 785 cny / ton, Uzbek 825 cny / ton.
- Coke: On November 25, the coke market was temporarily operating steadily. On the supply side, due to environmental inspections and continuous rounds of price drops, the overall operating rate of the coking plants was low, the coking enterprises lost profits, and the overall production was actively restricted. The supply continued to fall. However, due to the bearish market sentiment, shipments were not smooth and tired. In terms of demand, steel market prices have rebounded slightly recently, and the profits of steel companies have improved. However, steel mills still have expectations of a decline in coke, and they still focus on on-demand procurement. At present, coking plants are very resistant to reducing coke prices. It will be difficult for coke prices to continue to decrease in the short term. This week, the average hot metal excluding tax cost of the mainstream sample steel plants in Tangshan area was 3085 yuan/ton, and the average billet tax-included cost was 4,048 cny/ton, which was lowered by 247 cny/ton from the previous month, compared with the current general billet ex-factory price of 4,320 cny on November 24. Compared with ton, the average gross profit of steel mills is 272 cny/ton, which is an increase of 387 cny/ton on a week-on-week basis. At present, both supply and demand in the coke market are weak, costs are falling, and the downstream steel market fluctuates at a low level. In the short term, the coke market is weak.
- Scrap: On November 25, the average price of scrap in 45 major markets across the country was RMB 2832/ton, an increase of RMB 50/ton from the previous trading day. The current scrap market is operating within a narrow range and on the strong side. Today, the prices of black futures and finished products still maintain an upward trend, which underpins scrap prices. Steel mills have successively entered the winter storage stage, raising scrap steel prices to absorb goods. The market for scrap steel resources is generally tight, and some processing bases are bullish and unable to stock up, and traders have difficulty receiving goods. The scrap steel market is expected to consolidate within a narrow range in the short term.
Supply and demand of steel market:
- On the supply side: According to Mysteel’s research, the output of large-variety steel products was 8,970,700 tons this Friday, a decrease of 71,300 tons on a week-on-week basis.
- In terms of demand: the apparent consumption of large varieties of steel this Friday was 9,544,200 tons, an increase of 85,700 tons on a week-on-week basis.
- In terms of inventory: this week’s total steel inventory was 15.9622 million tons, a week-on-week decrease of 573,500 tons. Among them, the steel mill inventory was 5.6109 million tons, a week-on-week decrease of 138,200 tons; the steel social inventory was 10.351 million tons, a week-on-week decrease of 435,300 tons.
- The relationship between supply and demand in the steel market has improved this week, coupled with rising prices of raw materials and fuels, pushing steel prices to strengthen. Affected by the heating season and the Winter Olympics, even if the later steel mills resume production due to improved profitability, the expansion efforts may not be large, and it is not appropriate to overly bullish the prices of raw materials and fuels. Recently, speculative demand has been relatively active, and it is doubtful whether the downstream terminal purchases in the off-season will continue to improve. Short-term steel prices may slow down, and it is not appropriate to be overly optimistic.
Post time: Nov-26-2021