The recovery of the hottest downstream demand stim

2022-08-02
  • Detail

The recovery of downstream demand has stimulated the iron ore and steel prices to rise together

there have been some signs of recovery in the domestic steel market recently, and some steel mills are starting to replenish their inventories, which has greatly increased the demand of domestic steel enterprises for iron ore, and at the same time has also promoted the recovery of iron ore prices

the complete industrial chain of iron ore coke rebar has seen prices rise together recently, but compared with the prices and demand at the beginning of the year and last year, it is still difficult to assert that the domestic steel market has continued to warm up

iron ore, steel and coke with an import amount of USD 66.79 million in the first half of this year rose together

according to the latest statistics of Platts, the benchmark iron ore price sent to China last Friday rose to USD 132.75 per ton, the highest level since July this year. Compared with the annual low of USD 88.75 per ton in early September this year, the iron ore price has increased by nearly 50% in the past three months

the signs of recovery in the spot steel market also increased the market's credit yield point for rebar and coke futures prices σ S =ps/fo (MPA) center. Yesterday, 1305, the main rebar contract of Shanghai Futures Exchange, closed at 3819 yuan. The price reached a new high in the past five months. Compared with the beginning of September, the increase has exceeded 15%; As one of the main raw materials of steel mills, the 1305 price of the main futures contract of coke also hit a five month high

from the decline in port iron ore inventory, we can also see the huge demand for replenishment of inventory by domestic steel mills. According to my Steel's statistics on port iron ore, as of December 14, 2012, the total iron ore inventory in 30 major ports in China was 75.87 million tons, a decrease of 1.96 million tons compared with the previous week, a decline for seven consecutive weeks, and has dropped to less than 80million tons. Compared with the same period last year (december16,2011), the total inventory decreased by 20.24 million tons, with a year-on-year decrease of more than 20million tons for the first time

from the perspective of iron ore source, last week, the iron ore inventory from Australia, India and Brazil also decreased for seven consecutive weeks. The iron ore from Australia still decreased the most, down 1.4 million tons compared with the previous week. Although the decline of Indian and Brazilian mines narrowed, the decline reached 30000 tons and 240000 tons respectively

however, the rising prices of iron ore and coke have also brought more cost pressure to steel mills. In this context, on December 11, Baosteel Co., Ltd. issued the price policy for January 2013. Except that the hot-dip galvanizing and electro galvanizing prices remained unchanged, other prices were increased by 50~150 yuan/ton, ending the situation of maintaining or decreasing prices for several months. This is regarded as an important signal of increasing confidence in the steel market

many insiders predict that under the pressure of cost promotion and loss, other iron and steel enterprises, including Angang and WISCO, are likely to further increase the ex factory prices of relevant products

in addition, the continuous decrease in the number of blast furnace overhauls in steel mills also explains the phenomenon that the price of iron ore rises while the inventory decreases. According to my iron and Steel Statistics, as of the beginning of December, only 29 of the 395 blast furnaces in 163 steel plants in China were under maintenance. Since October, the number of blast furnaces under maintenance has been decreasing every week. At the end of September, the number of blast furnaces under maintenance reached 49

the reason why the iron ore coke steel industrial chain can increase prices at the same time is mainly because of the recent continuous promotion of infrastructure construction and the continuous recovery of the manufacturing industry. In December, the preview value of HSBC manufacturing PMI further rose to 50.9, a 14 month high. In addition, the infrastructure construction projects approved by the national development and Reform Commission in September will be compared with the old-fashioned With the implementation of the standardized design, the domestic steel output is expected to increase continuously in the next six months, and the raw material inventory of the steel plant will gradually decline. The mild replenishment interface and strong demand will drive up the demand and price of iron ore

it is difficult to assert that the steel market continues to recover

however, it is worth noting that although the steel price and output have increased significantly in the past few months, compared with the prices from 2010 to 2012, the steel price has not increased significantly. Taking the rebar price as an example, in 2011, the rebar price basically remained at the price of 4500 yuan, but since this year, the rebar price has never reached the high level of more than 4500 yuan. Since the beginning of this year, the price of rebar has fallen by about 10% compared with that at the beginning of the year, although it has risen and fallen from time to time

therefore, although the crude steel inventory of key domestic enterprises has continued to decline since late August, the inventory of steel mills is still at a high level, and the social inventory is also at a high level of more than 10million tons. Therefore, it may be too early to assert that the steel market has recovered

an iron and steel industry researcher told: "the sustained recovery of the iron and steel industry depends on the continuous increase of terminal demand. Otherwise, the internal inventory of iron and steel enterprises will continue to increase, and iron and steel enterprises will also face downward pressure on prices. It seems that the high price point reached in the past two years will still be difficult to reach in the future."

Copyright © 2011 JIN SHI