Factors affecting steel prices

Financial Commission heavy voice! Actively introduce favorable policies for the market

On March 16, the Financial Stability and Development Committee of the State Council held a special meeting to study the current economic situation and capital market issues. The meeting was presided over by Liu he, member of the political Bureau of the CPC Central Committee, vice premier of the State Council, and director of the Financial Commission, and responsible comrades of relevant departments attended the meeting.

Analyst's view: Affected by the meeting, the market's bullish mentality has increased, which is good for the macro economy. The increase in buying in the trading market has pushed prices up.

Bureau of Statistics: Sales Prices of Commercial Residential Buildings in First-tier Cities Rise Month-on-Month in February

In February, the price of new houses in 27 of the 70 large and medium-sized cities rose month-on-month. The sales price of newly-built commercial residential buildings in first-tier cities rose 0.5 percent month-on-month, down 0.1 percentage points from the previous month, with Beijing, Shanghai, Guangzhou and Shenzhen up 0.6 percent, 0.5 percent, 0.6 percent and 0.4 percent respectively. Second-hand housing in first-tier cities rose 0.5 percent month-on-month, an increase of 0.4 percentage points over the previous month, with Beijing, Shanghai and Guangzhou up 0.7 percent, 0.9 percent and 0.6 percent respectively, and Shenzhen down 0.2. Second-tier cities new commercial residential sales prices rose 0.1 month-on-month from the previous month to flat.

Analyst's point of view: Judging from the housing price trend in February, housing demand in first-tier cities has grown steadily, confidence in the real estate market has recovered, and the return of real estate funds has accelerated, which will also stimulate real estate development, growth in demand for building materials, and good medium and long-term steel prices.

From January to February, key steel enterprises produced 123.7687 million tons of crude steel, down 10% year on year.

From January to February 2022, the country produced a total of 157.96 million tons of crude steel, with an average daily production of 2.6773 million tons, a cumulative decrease of 10.0 percent over the same period last year; 132.13 million tons of pig iron, with an average daily production of 2.2395 million tons, a cumulative decrease of 10.80 percent over the same period last year; and 196.71 million tons of steel, with an average daily production of 3.3341 million tons, a cumulative decrease of 6.0 percent over the same period last year. From January to February, key statistics show that iron and steel enterprises have produced 123.7687 million tons of crude steel, down 12.07 percent from the same period last year, with a cumulative daily production of 2.0978 million tons of crude steel. The cumulative production of pig iron was 109.1236 million tons, down 11.49 percent from the same period last year, and the cumulative daily production of pig iron was 1.8496 million tons. The cumulative production of steel was 119.3145 million tons, down 10.18 percent from the same period last year, with a cumulative daily production of 2.0223 million tons.

Analysts' point of view: from the data point of view, the supply of crude steel and steel is reduced, the supply is tight and the demand is growing steadily. This increase and decrease will increase the price control ability of steel sellers, thus promoting the rise of steel prices.

Iron ore port prices mixed

According to the in stock quotation of domestic imported iron ore on March 16, Qingdao Port generally fell 10-30 yuan/ton, 61% PB powder fell 30 to 910 yuan/ton, 58% Australian powder fell 20 to 800 yuan/ton, 62.5 Ba powder fell 20 to 1020 yuan/ton, 65% Ba powder fell 10 to 1130 yuan/ton. Tianjin Port generally rose 10 yuan/ton, 61% PB powder rose 10 to 975 yuan/ton, PB lump ore rose 10 to 1310 yuan/ton, 62.5 pa powder rose 10 to 1080 yuan/ton, 65% pa powder rose 10 to 1190 yuan/ton.

Analyst's point of view: From the perspective of the polarization of iron ore prices, the long-short game in the market is still fierce. The state controls the prices of raw materials and increases the mining of domestic iron ore to buffer the price impact caused by insufficient international supply. The price is still fluctuating at a high level, and many businesses have turned to cheaper domestic iron ore, resulting in an increase in domestic iron ore demand and rising prices.

market price

Steel prices rose mainly on the 16th, individual fell.

Threaded steelOf the 24 markets, 9 rose by 10-40 and 1 fell by 10,20 mmHRB400E, with an average price of 4878 yuan/ton, up 8 yuan/ton from the previous trading day;

Hot rollOf the 24 markets, 15 rose by 10-70 and 3 fell by 10-40,4.75 the average price of hot-rolled coils was 5102 yuan/ton, up 23 yuan/ton from the previous trading day;

medium thick plateOf the 23 markets, 8 rose by 10-30,3 fell by 30-50, and the average price of 14-20mm general medium board was 5186 yuan/ton, up 3 yuan/ton from the previous trading day.

16A total of 23 steel mills adjusted prices in Japan, of which:

Up 5, accounting for 21.7 percent, the price adjustment range of 10-20 yuan/ton, the highest increase for Shougang Changzhi building materials;

Down 8, accounting for 34.8 percent, the price adjustment range of 20-100 yuan/ton, the largest decline for Shandong Chuanyang profiles;

Flat 10, or 43.5 per cent.

16 Tangshan Qian'an part of the general billet resources rose 40 to 4660 tax factory.

16 days of steel rose sharply

16 thread main futures rose 153, closed at 4904, or 3.22 percent; hot roll main rose 128, closed at 5080, or 2.58 percent; coking coal main rose 90.5, closed at 2917, or 3.2 percent; coke main rose 72, closed at 3548.5, or 2.07 percent; iron ore main rose 39.5, closed at 804, or 5.17 percent.

Steel price forecast:

Supply and demand:Affected by the epidemic, manufacturers supply reduction, supply is relatively reduced, and downstream demand is also affected by poor logistics, there are many uncertainties, the epidemic area of businesses in the short term more wait-and-see attitude. On the other hand, according to real estate data, transaction prices in first-tier cities picked up significantly in February, indicating an increase in market demand, which in turn led to the confidence of real estate developers to acquire land and start construction, and the purchase of steel will also increase in the future, which is good for steel prices.

Cost aspect:As overseas iron ore prices are still high, iron ore prices are gradually "polarized". Iron ore demand gradually shifted from abroad to domestic, port price growth slowed, domestic prices quickly followed.
From the futures market point of view, the current price is in the rising channel of the low, support is more obvious, the future price is strong operation.

Therefore, the price of steel is bullish, the range is around 50.