Are steel prices swinging or rising?
In December, the price of building materials remained in a narrow range as a whole, with the overall center of gravity shifting upward, and the room for fluctuations was limited. On the demand side, most of the terminals are based on replenishment on demand, and market speculative demand has significantly weakened; on the supply side, production restrictions are still frequent in various regions, and shortages in some regions are common, and manufacturers are not willing to adjust. At present, the price of HBIS third-grade large thread in Beijing is 4700 yuan/ton, which has little change from the beginning of the month; the price of Tangshan Anfeng wire rod is 4760 yuan/ton, which is a cumulative increase of 140 yuan/ton from the beginning of the month. From the perspective of the overall market, the fluctuation range of the thread is Smaller, the wire rises slightly expanded.
On the 14th, steel mills adjusted the price of building materials steadily and increased:
On the 14th, the price policy of snails in the national steel mills: stable and strong, each rose 20-50, and the other decreased by 30; among them, the North China snails trended after the opening. The transaction volume was high yesterday, and the spot market prices are firm today. The prices of steel mills are slightly explored. Merchants reported that the downstream replenishment enthusiasm was acceptable, and transactions were held at low levels; steel mills in the southwest region were willing to increase, the market was limited to follow up, and resource specifications were uneven.
Now let’s take a look at the spot situation in key areas of the North China market:
supply side
First of all, from the perspective of supply, the thread and coil production lines of individual steel mills in Tangshan have recently resumed production. At the same time, because the prices in the north are still high, the supply of foreign materials in the northwest, northeast and other regions has increased slightly, and the current trend of reducing stocks is As a result, inventories in some regions have turned from falling to rising, but some market specifications are still in short supply.
demand side
Entering December, the temperature has gradually dropped, and some construction sites in the northern region have entered the stage of finishing work, especially after the end of December, the actual demand has almost stagnated, and the overall transaction volume is limited. As can be seen from the above figure, since November, the mainstream in Beijing Almost all large-scale transactions are below 10,000 tons, the actual transaction performance is limited, speculative demand has decreased significantly, and most of them are based on terminal replenishment on demand.
From a specific market perspective:
[Beijing Market] In terms of steel mill production, currently 6 threads are in production at JY steel mill, 1 thread at CG steel mill is in production, and 1 thread at LG steel mill is in production. The arrival of the market is still limited, with large threads in the disk. The 20mm and 22mm specifications are in short supply, which has strong support for prices. However, due to the impact of demand, the overall inventory of construction steel in Beijing is currently 212,000 tons. The inventory has changed from a decline to an increase, and it is difficult to increase prices.
[Handan Market] In terms of small factories, the latest statistics of the total wire stock in Wu’an Small Factory is 132,000 tons, which is a decrease of 17,700 tons from last Friday. The total production line is 7, which is 1 less than last Friday, and the operating rate is 41%. In the latter part of the week, terminal replenishment on demand, the daily transaction volume is about 16,000-18,000 tons. At present, the actual operating rate of steel mills is relatively low, and the shortage of resources in Wu’an is widespread, which supports prices. For large manufacturers, HG thread, Pansnail production lines are all in a state of suspension, and the recovery time is yet to be determined. XXZG steel mills are subject to coking problems, and the production of 1 thread is not saturated. The actual output of building materials is limited, and large companies are willing to pay more.
[Tangshan Market] Market prices in this region have significantly slowed down from yesterday’s increase, and the price of wire snails has been operating steadily. After the autumn and winter in Tangshan, production restrictions and early warnings are relatively frequent. The billet mills have been in a state of suspension of production recently. The rest of the steel mills At present, the production lines of individual steel mills have recovered, and the overall operating rate is now 21.6%. Downstream demand is becoming weaker. At the same time, near the end of the year, merchants are operating more cautiously, and speculative demand from middlemen is also decreasing. Most of the market is waiting and watching.
Core point of view
On the whole, the North China market maintains a pattern of weak supply and demand. Although inventories have increased in some areas, steel mills have actually received less goods and overall resources are still tight. Therefore, price support is relatively strong. Entering December, near the end of the year, traders are not willing to buy goods, and they are at the node of winter storage, they are more cautious, and most of them are mainly shipped on rallies. Taking comprehensive considerations into consideration, building materials prices have support and resistance, and it is expected that the price of building materials will be adjusted within a narrow range in the short term.