Into April, the policy continues to land, major projects funding in place, the gradual release of terminal demand and other factors under the joint influence of the domestic steel market are expected to run weakly, do not rule out the opportunity for a stage of rebound.
Review of the steel market in March, the macro-expectations are not enough, end demand is weak, supply pressure is large and the cost of negative feedback, the domestic steel market has been sharply shocked downward.
Data show that in March, the national average comprehensive steel price of 4059 CNY/ton, down 192 CNY/ton, or 4.5%.
Sub-species point of view, high steel wire rod, grade Ⅲ rebar prices fell the largest, down 370 CNY/ton or so; seamless steel pipe prices fell the smallest, down 50 CNY/ton.
On the supply side, since March, China's iron and steel enterprises have been facing a more obvious structural contradiction between supply and demand, steel prices have been sharply downward, the pressure of corporate losses has increased, the steel enterprise's inventory is difficult to reduce, the steel associations in many places to call for the self-discipline of the regional steel enterprises to control the production, and has achieved certain results.
On the demand side, at present, the weather is gradually warming up, but due to the poor availability of project funds, the construction progress of major projects is not satisfactory, inhibiting the release of end demand. At the same time, the total amount of steel social inventory is higher than in the same period last year, inventory pressure is still big, is expected that steel social inventory in April will decline, but the rate of decline still depends on the speed of demand release.
In terms of raw fuels, since March, raw fuel prices have shown a shocking downward trend.
From the point of view of average iron ore prices, in March, the average price of 66% grade dry base iron ore concentrate in Tangshan area of Hebei was 1009 CNY/tonne, down173CNY/tonne, or 14.6%; the average price of Australian 61.5% fines (Rizhao port of Shandong Province) was 832CNY/tonne, down 132CNY/tonne, down13.7%.
As for coke, since March, coke prices have experienced three rounds of cuts, and as of the end of March, the price of secondary metallurgical coke in Tangshan was 1,700 CNY/tonne, down 300 CNY/tonne from a year earlier. In terms of average value, in March, the average price of secondary metallurgical coke in the Tangshan area was 1,900CNY/ton, down 244CNY/ton, or 11.4%.
In terms of steel scrap, in March, the price of steel scrap oscillated downward, and by the end of March, the price of heavy scrap in the Tangshan area was 2,470 CNY/tonne, down 230 CNY/tonne from a year earlier. From the average value, in March, the average price of heavy scrap in the Tangshan area was 2,593 CNY/ton, down 146 CNY/ton, or 5.3%. Driven by the obvious decline in raw fuel prices, the steel cost platform moved further down.
In March, construction steel turnover increased from the previous year, although the year-on-year trend is still shrinking.
According to data from Lange Steel, the average daily turnover of construction steel in 20 key cities across the country was 147,000 tons in March, an increase of 92,000 tons year-on-year. Into April, construction projects will accelerate the construction, however, taking into account the current real estate investment is still weak, it is expected that the demand for construction steel in April will show a chain growth, down year-on-year trend. Later, as the policy continues to land, the real estate market is expected to gradually stabilize.
From the manufacturing industry, it is expected that manufacturing steel demand will remain resilient. At present, the manufacturing industry boom has rebounded.
China's manufacturing PMI (purchasing managers index) in March was 50.8%, up 1.7 percentage points from the previous year, back above the line. This is both the impact of seasonal factors, but also shows that the economy is picking up a solid trend, is expected in April manufacturing steel demand in the automotive, home appliances, ships and other industries to run under the drive to maintain resilience, is expected to drive the stage of steel prices rebound.
Post time: Apr-11-2024