Recently, "Beijing, Tianjin and Hebei and its surrounding areas for 2018-2019 years and autumn and winter air pollution comprehensive treatment program (Draft)" issued by the iron and steel, coking, casting industry to implement partial peak production. In the heating season of key cities such as Tianjin, Shijiazhuang, Tangshan, Handan, Xingtai and Anyang, the production of iron and steel is limited by 50%, and the proportion of other cities should not be less than 30%.
Last week (July 30th ~8 3), the domestic steel market rebound. Related parties pointed out that, on the whole, environmental protection limited production has become the norm in the steel industry. In August, the release of steel production will be restricted. In the next ten days of 8, the high temperature and rainy weather retreats, the construction project is expected to recover gradually. The supply and demand contradiction of the iron and steel market will be relieved, and the policy signal transmitted by the meeting of the State Council and the Political Bureau of the State Council in the near future makes the market confidence boost, and is expected to be 8 In June, the domestic steel market showed a strong trend of turbulence.
The main basis for the above judgment is:
First, the demand for steel circulation in July rose. In July, the iron and steel industry PMI (Purchasing Managers Index) was 49.4%, up 1.2 percentage points from June. The results of the survey showed that in July, the sales of steel circulation enterprises, the quantity of orders rose slightly, the confidence of the enterprises improved and the desire of market purchasing increased, and the demand of steel circulation market in August was expected to recover.
Second, demand is expected to recover gradually. From the demand of the iron and steel downstream, the high temperature and rainy climate still have an impact on the construction projects in mid August, but the demand is expected to recover gradually as the weather turns better in the next ten days. Recently, the Standing Committee of the State Council once again reiterated the need to expand domestic demand and increase financial expenditure. In July, 19 provinces issued nearly 200 billion yuan of special debt for infrastructure construction. Under the protection of relevant policies, the infrastructure investment in the second half of this year is expected to increase significantly. In addition, in July, the PMI of the service industry survey center of the National Bureau of statistics and the China logistics and purchasing Federation (China logistics and procurement Federation) was 51.2%, which was down 0.3 percentage points from June, but it was over 51% in a row for 5 months, reflecting the relatively stable prosperity interval of manufacturing industry.
Third, in July, the domestic steel market showed a trend of upward trend. Monitoring data show that as of July 31, the national steel composite price index was 164.3 points, up 2.5% from the end of June, up 11.0% year-on-year.
Fourth, the national steel social stock rebounded again. In July, steel social inventories showed a downward trend, but slowed down significantly. As of August 3rd, the stock of social steel has recovered again. The steel social inventory of 29 key cities in the country was 8 million 459 thousand and 700 tons, up 161 thousand and 400 tons, up 1.94% from the previous week.
Fifth, in July, the coke price dropped and the cost supporting effect weakened. In July, both the price of domestic iron powder and the price of imported iron ore were all rising, which had been affected by the decline of coke prices, and the support for the later market was reduced. At present, the iron ore market is generally oscillating and weakening, and the import price of iron ore is gradually falling to 60 US dollars / tons ~70 US dollar / ton, entering a new round of price shock adjustment period. Cost monitoring data show that the average cost of plain carbon billets produced with raw materials and fuels purchased in July is 40 yuan / ton lower, or 1.5% lower, than in June.
Experts say the domestic steel demand will be exuberant from the trend of development in response to the U.S. - provoking trade war and the efforts of the national decision-making department to expand domestic demand, including loose monetary policy, more active fiscal policy, and quicker investment in infrastructure. In addition, under the high pressure of environmental protection, the release of backward production capacity is restrained, and the supply and demand of the steel market is further improved. At the same time, the cost of production and logistics is improved, and a strong cost support is formed. In short, there is still a driving force for rising prices in the steel market. However, steel prices continue to rise, reaching a critical point, which will suppress demand and guard against market risks.
