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How was China's hot rolled steel market in June?

2024-06-25 09:42:04

Since entering June, China's cold and hot rolled steel coil market upturn has not been obvious, market transactions are generally cold, cold and hot rolled coil prices are running shockingly, and traders are generally cautious and optimistic about the market after the market.

In the first half of June, China hot rolled steel price in the Shanghai market fell by RMB 10/tonne, with average market demand. During the same period, the price of cold rolled steel coil in Shanghai market also fell by RMB 10/tonne, and the supply of cold rolled products was abundant.
From the cold and hot rolled steel coil market trading conditions during this period of time, traders generally feel that business is cold, downstream end-users are more cautious in purchasing, basically on-demand purchasing, traders are not selling well. Some merchants in order to ship, choose to accept customer bargaining, resulting in the loosening of the steel transaction price, steel prices 'open + dark drop' phenomenon is more common.
For the late cold rolled steel and hot rolled steel market sentiment trends, the late hot rolled steel coil market prices will stabilise, cold rolled steel coil prices will be weak consolidation, mainly due to the following aspects:

First, the downstream terminal effective demand is weak. 

Recently, the cold, hot rolled coil consumption of automobiles, home appliances and other manufacturing production and sales have changed. Passenger car market information association statistics show that May 1 - May 26, China's passenger car market retail sales reached 1.208 million, down 6% year-on-year, down 2% from the previous year. early June, China's passenger car market retail sales reached 360,000, down 8% year-on-year, down 23% from the previous year.
At the same time, home appliance manufacturing production and sales conditions have also changed.
Aowei cloud online market monitoring data show that in May, China's refrigerator, freezer, washing machine, air conditioning online retail sales scale year-on-year decline of 14.4%, 15.8%, 12.4%, 37%. According to other statistics, on the scale of offline retail sales in May, refrigerators and washing machines grew by 10.1 per cent and 12.9 per cent, while freezers and air conditioners fell by 9.1 per cent and 1.3 per cent.
Overall, this period, China's home appliance products online, offline sales have declined, the cold, hot rolled coil demand strength is generally weak, supporting the lack of power of rising steel prices.

Secondly, the cold and hot rolled coil market supply shrinkage is not obvious. 

Recently, although the steel enterprises to control production, production restrictions have increased, and the news about the introduction of national crude steel production control policy has also continued, but in fact, steel production has not been reduced. China Iron and Steel Industry Association statistics show that in the first half of June, the average daily crude steel production of key statistical iron and steel enterprises reached 2,248,300 tonnes, an increase of 3.3% from the ten-month period, an increase of 0.77%. the end of the first half of June, the key statistical iron and steel enterprises steel stockpiles of about 16,086,200 tonnes, an increase of 1,159,400 tonnes from the ten-month period, an increase of 10.43%.
Steel production and inventory double increase, is expected in the short term, including cold, hot rolled coil market supply will continue to increase.

Third, the cost side of the support for steel prices has weakened.

Recently, iron ore, coke, scrap steel and other raw steel fuel prices shock fluctuations. 10 June - June 16, coking coal market prices of major varieties fell 50 yuan / tonne ~ 70 yuan / tonne; coke market, the 2nd round of adjustments to land, down 50 yuan / tonne ~ 55 yuan / tonne; scrap prices fell to 20 yuan / tonne ~ 50 yuan / tonne; the price of imported iron ore prices shock fall The price of 61.5% PB powder in Shandong Qingdao port was quoted at RMB 818/tonne, down RMB 21/tonne.
Steel raw fuel market prices fell shockingly, steel prices rigid cost support is not strong, it is difficult to support the late cold, hot rolled coil prices.