Tisco Steel: How much influence is the maintenance of Shandong Building Material Factory?
1. What is the real reason for the sudden suspension of production for maintenance?
From the uproar of the limited production of crude steel at the beginning of this year to the present, Shandong Steel Plant seems to be slightly embarrassed. From the sudden announcement of the suspension of production on the 18th of MY Steel Plant to the end of the year, to SH Special Steel due to lack of steel billet and building materials, all rounds of overhaul are guaranteed. The production of profiles and bolts, the average daily production capacity of Shandong Building Materials can not even guarantee the volume of 40,000 tons. In history, steel plants in Shandong Province have never seen such a concentrated large-scale overhaul, and the price has fallen by nearly 1,000 in one month. Under the premise of, this kind of maintenance information seems to give the market a shot in the heart.
2. The spread between North and South spreads, and the hidden dangers of external resources are greater
Let’s take a look at a set of data: According to statistics as of 11.11-this week, Weifang area inventory: Shiheng 6000 tons (7000 tons last week), Yongfeng three warehouses 15000 tons (18000 tons last week), Minyuan 13000 (15,000 last week), Xiwang 12,000 (15,000 tons last week), Laiwu Steel 3,000 (2,000 tons last week). Weifang’s existing foreign material brands: Xinda 4000 (2000 last week), Xugang 3000 (2000 tons last week), Linggang 2000 (2000 tons last week), Shaanxi Longgang 2000 tons (3500 tons last week), Jianlong 2000 (2000 tons last week), Hongda 5000 (2000 tons last week), Fusteel 1000, Japan Steel 4000 (3000 last week), 3000 tons for other plants. The total inventory was as high as 73,000 tons (77,500 tons last week), and the inventory was reduced by 4,500 tons. The resources of local steel mills decreased significantly. The external resources increased by Xinda, Xugang, Hongda, and Japan Steel, indicating the increase in foreign materials It puts a certain pressure on local sales. Although the price has been adjusted upward due to the recent macro news on real estate, the overall demand is still not digested well. It is expected that the short-term stability will be mainly weak.
Figure 2: Shandong mainstream steel mills and market inventory chart
From the above figure, we can see that although the recent steel mills have not saturated production, the Panxian stocks are still increasing, indicating that the contradiction between supply and demand still exists under the off-season demand, but it has been relatively blurred under the background of this year’s production restriction. The cost of wire rod rolling is relatively high compared to threads. Recently, due to the lack of raw materials, the enthusiasm of steel mills to produce coils has also begun to decrease. The editor believes that this round of maintenance should not only observe the reduction of supply in the province, but also consider the impact of foreign materials.
On the whole, with the recent tightening of the overall production restriction of Shandong steel plants, the capacity utilization rate of later production capacity steel plants will remain relatively low; prices have fallen sharply, there are more panic selling phenomena in the market, and social inventories are likely to continue to decline, but Considering the impact of external resources and the impact of public health and safety incidents on construction sites, it is expected that market prices may fall rapidly after a short-term rebound.