Forecast Steel Market Trends in October

2024-09-25 13:51:23

China's steel market in September did not show the characteristics of the peak season, downstream demand is still weak, market transactions are relatively light, steel prices continue to fall, and steel traders are generally cautious about the market after the market.

At the beginning of the Golden Nine, the domestic cold rolled steel and hot rolled coil price trend shows a ‘fierce, fast, large decline’ characteristics.

In the first half of September, the Shanghai market, Anshan Iron and Steel production 1.0 mm cold rolled steel plate ST12 prices from the end of August 3780 yuan / tonne to 3690 yuan / tonne, down 90 yuan / tonne; Shougang, Anshan Iron and Steel production 5.5 mm ~ 11.75 mm × 1500 mm × C hot rolled steel coil Q235B prices from the end of August 3200 yuan / tonne to 3040 yuan / tonne, down 160 yuan / tonne.

From the trading situation, into September, downstream end-users into the market purchasing willingness is not strong, basically on-demand procurement. Steel traders have chosen to accept customer bargaining, in the steel transaction price to give concessions, resulting in steel prices ‘down + dark’ phenomenon is more common.

For the later cold, hot rolled coil market sentiment trends, the short-term upturn or not obvious, cold, hot rolled coil prices will not continue to fall sharply, but a significant rebound in the market is also difficult to appear. In addition, he reminded market participants to pay attention to some uncertain factors affecting market conditions.

First, the ‘two new’ work to accelerate the ‘steel demand’ can be expected.

Since August, cold and hot rolled steel market demand is weak, automotive, home appliances and other manufacturing production and sales in general, hot and cold rolled coil demand has decreased. According to statistics, in August, China's commercial vehicle market sales reached 271,900 units, down 12% year-on-year, has been less than 300,000 units for 2 consecutive months. Home appliance market sales are also more general. According to statistics, in August, China's online retail sales of colour TVs and refrigerators fell 6.4% and 2.3% year-on-year respectively.

During this period, automobile, home appliances and other manufacturing industries on cold and hot rolled coil plate demand intensity has weakened. However, into October, automobiles, home appliances and other manufacturing production and sales conditions are expected to improve. In addition, all over the country is also accelerating the ‘two new’ (large-scale equipment renewal and consumer goods trade-in) work to the ground.

Household appliances to the depth of the work will promote the home appliance manufacturing production and sales growth, is conducive to pull the late cold rolled steel coil rolled steel sheet and hot rolled steel plate demand release.

Secondly, the excessive growth of supply will further aggravate the contradiction between supply and demand.

Data show that in August, China's crude steel production reached 77.92 million tonnes, down 10.4% year-on-year. In the first eight months of this year, China's crude steel output reached 691.41 million tonnes, a year-on-year decline of 3.3%.

Recently, with the blast furnace profit has recovered, some steel enterprises resumed production momentum enhanced, the supply showed a certain increase trend. Research data from industry institutions show that by September 4, the blast furnace operating rate of the country's major steel enterprises reached 75%, up 0.5 percentage points week-on-week. Also according to the China Iron and Steel Industry Association statistics, in the first half of September, the average daily crude steel production of key statistical steel enterprises reached 1.936 million tonnes, an increase of 2.7% week-on-week.

In the demand release is still insufficient background, the supply increase will undoubtedly aggravate the contradiction between supply and demand, will have a greater impact on the late steel market.

Third, the raw steel fuel market fluctuations, cost support weakened.

Recently, iron ore, coke, scrap and other raw steel fuel market prices fluctuations. Separately, the recent week, the domestic coking coal market prices fell 20 yuan / tonne ~ 50 yuan / tonne; coke market, the 8th round of adjustments to land, the cumulative decline reached 400 yuan / tonne ~ 440 yuan / tonne; scrap market prices mixed, price fluctuations reached 50 yuan / tonne ~ 80 yuan / tonne; iron ore market prices shocked up.

Considering the weakening cost support, some large steel enterprises raised the ex-factory price of steel in October. This will have a certain impact on the late cold and hot rolled steel market.