In March this year, domestic steel prices fell sharply, and market pessimism spread. According to China Steel Association, as the domestic manufacturing industry and the steel industry PMI index double rebound, will continue to drive steel demand increases, in April, the domestic steel market is expected to show a fluctuating trend of rising trend.

 

 

In March 31st, the index report issued by the China National Association of iron and steel logistics (Specialized Committee) showed that the PMI index of the steel industry in March was 50.6%, and the ring rebounded by 1.1 percentage points, and returned to the top of the 50%. According to the market performance in late March, market demand is expediting release, high storage pressure is gradually digested, and the supply and demand situation of steel market in April is expected to be improved, and the price of steel is expected to usher in a recovery after the plunge.

 

 

PMI showed that steel production accelerated in March, and orders rebounded slowly, and steel prices fell sharply. In the main sub index, the production index rose significantly to the expansion interval, the new order index slightly increased, the new export order index decreased further, the product inventory index increased significantly, and the raw material inventory index fell to the contraction interval.

 

 

Specifically, in March, the PMI index of steel industry was 50.6%, which rose by 5.2 percentage points, with a larger increase. The production related procurement activities were all falling down. With the end of the northern heating season, steel mills are still expanding production. However, in the case of narrowing profits, the raw material replenishment of steel plants is not very motivated, and the inventory is mainly in the digestion plant. According to the data from the west new trunk line, the average number of ore imports in domestic large and medium steel mills at the end of 3 is 22 days, 3 days lower than the end of last month, 10 days for coke availability, 0.5 days lower than at the end of last month.

 

 

From the demand situation, with the disappearance of the Spring Festival factors, the overall demand in March has been restored. In March, the new order index was 51.9%, which rose by 0.6 percentage points, which is higher than that in February, lower than that in January. In March, the new export orders index was 40.9%, a decrease of 3 percentage points, and a 16 month interval.

 

 

In March, the finished product inventory index was 56%, rising by 3.5 percentage points, reaching the high point since 2015 January. In March, the output of steel plants increased, but the sales temperature returned slowly. So the inventory pressure of steel mills increased gradually. According to the data from China Steel Association, the steel stock of member steel enterprises was 14 million 681 thousand and 300 tons in the first ten days of March, an increase of 708 thousand and 800 tons over the last ten days, an increase of 5.07%, an increase of 54.07% compared with 5 million 152 thousand tons in early February, and an increase of 3.92% over the same period of last year by 554 thousand tons. Inventory in steel mills has increased by more than 5 million tons in recent three days, and inventory pressure has increased significantly.

 

 

In March, the domestic steel market suffered Waterloo, the price of steel fell sharply, and the storage resources of the merchants were badly damaged. According to the monitoring of the West Shinkansen line, the steel index in the early March was 4330 yuan / ton, and then climbed to 4350 yuan / ton, and then entered a continuous downward channel. As of March 30th, steel prices have dropped to 3800 yuan / ton, compared with the beginning of March fell to 530 yuan / ton.

 

 

Looking ahead, the index report believes that the domestic economy is running well, and the demand for steel remains stable. Environmental protection and capacity reduction will still inhibit the supply of steel. From January to February, the investment in fixed assets increased by 7.9% compared with the same period last year, or a record high since last August. In the main steel industry, the general equipment manufacturing industry, special equipment manufacturing, automobile manufacturing, railway and ship aerospace and other transportation equipment manufacturing, electrical machinery and equipment manufacturing, computer communications and other electronic equipment manufacturing, power and thermal production and supply industry increased by 9.1%, 10.3%, 4.9% respectively. 4.9%, 9.4%, 12.1% and 13.1%. In March 2018, the PMI index of manufacturing industry was 51.5%, 1.2 percentage points higher than that of last month, and it was in a period of more than 50% for 20 months. The smooth growth and toughness of the economy had a good support for the development of the steel industry.

 

 

With the double rise of PMI index of domestic manufacturing and iron and steel industry in March, market pessimism will gradually improve. According to the analysis of the index report, the demand for steel demand will continue to pick up, and the output will continue to rebound, and the domestic supply and demand situation is improved. It is expected that the domestic steel market will show a trend of concussion in April.