What is the main reason for the recent surge in steel prices, and whether the steel bull market will continue? Construction Credit futures Wang Haifeng analysis said that the policy is good for the real estate industry, driving steel prices upward. At the same time, the surge in raw material prices constitutes cost support for steel prices. However, the winter consumption off-season will come or restrain steel prices, and the afternoon market or peak shock. Steel price momentum, macro efficient support. On 20 November, the Premier became head of the Central Financial Commission. The meeting deliberated and adopted the division of key tasks related to promoting high-quality financial development. Efforts should be made to improve the quality of financial services for economic and social development, and on the basis of maintaining the robustness of monetary policy, increase support for major strategies, key areas and weak links. The domestic financial market has risen, especially the introduction of real estate protection and investment policies, which has led to the rapid rise of the steel industry.
A meeting of the Central Financial Commission deliberated and adopted a division of key tasks related to promoting high-quality financial development; Caixin reported that the regulator is drawing up a white list of Chinese real estate companies, which could include 50 state-owned and private property companies, and will receive support from a variety of sources including credit, debt and equity financing. Driven by macro favorable factors, the raw material end, especially the iron ore plate price rose strongly. Iron ore futures continued a strong trend, now up more than 2%, China Steel network information research Institute research and analysis, although the supply of hot metal is still in a stable decline, but iron ore prices did not follow a large pullback. The first reason is that the supply of hot metal in the market is expected to be stable at more than 2.35 million tons; Secondly, the rate of decline of molten iron production is not fast, and the absolute value is still at a high level in the same period in history. Finally, the contradiction of low inventory is still unresolved.
It can be seen that even if the news about iron ore futures being guided by the window, the pullback of the plate price is actually far less than expected. The rebound in plate profits indicates that the contradiction of "low demand, high price" of steel may be traded, but it is difficult to assert that the negative feedback market will start in the near future. Because the current charge and steel prices are still in a strong range, it is expected that the switch of market logic will not be smooth. By extension of this logic, the short-term steel price decline is more difficult. Raw materials and steel mills push each other, and the market price rises in a cycle. From the perspective of industry, with the continuous introduction of domestic macro policies, steel consumption in infrastructure, manufacturing and other industries has increased, and the subsequent consumer side is expected to remain resilient. At the same time, the profitability of steel mills has improved recently, some maintenance blast furnaces have resumed production, and the average daily molten iron production has remained high for a long time, and the supply is more adequate. The current macro policy is expected to stabilize for the time being. The profit of thread and hot coil improved, especially the profit of electric furnace rebounded sharply. The output of thread and hot coil rose from the previous quarter. From the perspective of profit, it is expected that the production of thread and hot coil will gradually rebound. Due to the speculation of winter storage expectation, there is little possibility of the price trend falling.
