Source: Futures Daily
The profits of steel enterprises have rebounded, and new changes have appeared in the market
Recently, there have been new changes in the steel market.
“After the price rise, the profits of steel mills recovered relatively quickly, and the output continued to rise. The market is still worried that once the demand falls short of expectations, the rebound in output will have a greater impact on destocking.” said Qiu Yuecheng, director of black research at Everbright Futures.
Tu Weihua, a black researcher at Baocheng Futures, also told reporters that among the 247 steel mills announced by the Steel Federation last week, only 35.93% of them were profitable. Under current cost accounting, the profit per ton of steel of most varieties has ushered in a significant rebound, among which the East China regionRebar、Hot rollThe profit per ton of steel rose by 101 yuan and 97 yuan respectively compared with the previous low point.
In addition, the price difference of snail waste has remained high recently, and the current cost accounting has shown profitability, which shows that the current electric furnace factory profits are relatively good; according to the survey data of the Steel Federation, last week, 26.32 % of the steel mills made a small profit, 65.79% of the steel mills were flat (most of them were flat due to the suspension of production), and only 7.89% of the steel mills were at a loss.
“Thanks to the recent rise in steel prices, the profits of steel mills are currently recovering, and the profits per ton of steel for some varieties are still good under current cost accounting.” Tu Weihua said.
The output rebounded obviously, and the thread inventory turned into a downward channel
The data shows that the output of rebar increased by 188,200 tons to 2.8217 million tons, and the lunar calendar decreased by 81,100 tons year-on-year; 10,000 tons, an increase of 170,000 tons year-on-year in the lunar calendar. This week, the apparent consumption of rebar rebounded by 719,100 tons from the previous month to 2.9368 million tons, a year-on-year increase of 381,500 tons in the lunar calendar. The weekly production of rebar has rebounded for the fourth consecutive week, the total inventory has turned from rising to falling, and the demand for tables has continued to rise month-on-month and year-on-year. The data performance is basically in line with expectations.
Qiu Yuecheng told reporters that on the supply side, with the recent rise in steel prices, the profits of long and short process steel mills have rebounded, and the power of steel mills to resume production has further strengthened, and the output has rebounded significantly. On the demand side, the resumption of work and production at downstream construction sites has been further accelerated, stocking is relatively active, and market transactions have increased significantly. From Monday to Wednesday of this week, my iron and steel monitoring national average daily trading volume of building materials was 179,800 tons, an increase of 24.97% from the previous week, and an increase of 2.97% compared with the same period in the lunar calendar last year. The weekly increase was 19.37%, compared with the increase of 35.38% in the same period of the lunar calendar last year, and the thread inventory in the Hangzhou market fell to 858,000 tons.
According to the statistics of Century Construction Network, as of February 21, the resumption rate of construction enterprises across the country was 86.1%, an increase of 9.6 percentage points from the previous period, and an increase of 5.7 percentage points from last year (the second day of the second lunar month); the labor service delivery rate was 83.9%, an increase from the previous period 15.7 percentage points, an increase of 2.8 percentage points year-on-year.
“The project resumption rate and labor service delivery rate are higher than the same period last year, and the terminal demand has recovered relatively quickly. On the fourth and fifth day after the Spring Festival, the inventory of major varieties and rebar steel has turned into a downward channel, and the inventory performance is better than the same period in the past few years. However, the price of rebar has risen relatively recently, and the terminal acceptance needs a process, andiron oreThere was a correction in the price of stone, which had a certain impact on market sentiment. “Qiu Yuecheng said.
The reporter noticed that when the current rebar production increased, the inventory turned into a downward channel.
The steel production and sales data released by the Steel Federation this week show that the inventory of the five major varieties has begun to decline, a decrease of 309,500 tons from last week, and the total rebar inventory is 12.5324 million tons, a decrease of 115,100 tons from last week. However, the decline in steel inventories did not drive the continuous rise in steel futures prices. On the contrary, the main contracts of rebar and hot coils rose and fell back on Thursday, recording a small decline and oscillating at high levels in the past two trading days.
“At present, the main reason for the slowdown in the rise of steel prices is that the strength of raw materials has not continued, and the coal mine accident has disturbedcoking coalFutures prices rose and fell back, and the rise was lower than expected, while the rise in ore prices was also slowing down under the suppression of regulatory policies. In addition, similar consulting agencies have announced the decline in steel inventories in advance, and the rise in steel prices in the early stage has already reflected the benefits of inventory removal. “Tu Weihua said.
Xia Xuezhao, a senior researcher of the black department of Southwest Futures, also told reporters that this means that the traditional inventory accumulation cycle around the Spring Festival has ended, the inventory turning point in the market has appeared, and the market will enter an inventory consumption cycle in the later stage. In contrast, the accumulation of inventory before and after the Spring Festival this year is significantly lower than in previous years. Compared with the date of the lunar calendar, the inventory of 12.53 million tons is the lowest level in the same period in the past six years. It is against this background that the price of rebar futures continued to rise before the Spring Festival, and showed a trend of high volatility after the Spring Festival.
The reporter found that rebar showed a rebound in both supply and demand, and the demand recovery was good, which in turn led to the destocking of this week. Specifically, construction steel mills are actively resuming production. The weekly output of rebar increased by 188,200 tons month-on-month, which has increased for four consecutive weeks. pick up. At the same time, the demand for rebar is also recovering. The weekly table demand increased by 718,800 tons month-on-month, which has increased significantly for two consecutive weeks and is already higher than the level of the same period last year. The purchase data of construction steel by major traders in the country is also low and heavy, showing that demand is expected to rebound In fulfillment, the superimposed macro-optimistic expectations have not changed, and continue to give strong support to steel prices.
“The recovery of terminal demand has brought about an improvement in the supply and demand pattern of rebar, and the superimposed market sentiment is optimistic. Steel prices remain high in the short term. It should be noted that rebar production is picking up. Once demand performance falls short of expectations, beware of the risk of steel prices falling back then.” Tu Weihua said .
Xia Xuezhao told reporters that the steel market is switching from a weak supply and demand pattern to a booming supply and demand pattern. Affected by climate factors, my country’s steel market presents seasonal characteristics. The traditional off-season is around the Spring Festival, and the market will gradually enter the peak season after March. The iron ore market is roughly in a state of balance between supply and demand. In recent weeks, the resumption of blast furnace production has led to an increase in iron ore demand, but iron ore supply has maintained a normal rhythm, iron ore port stocks have increased slightly, and there is no obvious gap in the iron ore market.
What are the reasons for the rise in raw material prices to varying degrees?
Tu Weihua told the Futures Daily reporter that the core logic of the recent rise in raw material prices is the ferment of optimistic expectations in the market, and the reason for the change in expectations is due to two factors: one is the real estate recovery that boosts the market. Sales have picked up, and with the pilot real estate private equity fund launched by the China Securities Regulatory Commission this week, favorable policies for real estate financing have reappeared. Second, the optimistic expectation of demand in the peak season is being fulfilled. The national construction site resumption rate and labor service delivery rate announced by Centennial Construction Network have exceeded the level of the same period in the lunar calendar last year, indicating that the downstream resumption of work is better, and the demand index for high-frequency finished products is showing a low rebound, which also proves that above point of view.
Xia Xuezhao told reporters that the core basis for rising raw material prices should be the resumption of blast furnace production. According to data from relevant information agencies, the national blast furnace capacity utilization rate has risen for the sixth consecutive week, and the consumption and demand for raw materials are indeed increasing. At the same time, there are different degrees of bullish factors on the supply side of raw material varieties. The current black industry chain commodities as a whole show obvious strong characteristics, which is caused by positive macro expectations.
In fact, China’s economic recovery is expected to be superimposed on the resumption of production of steel mills after the festival, which will stimulate the demand for raw materials. Under low inventory conditions, the upward elasticity of raw material prices is greater than that of steel prices, affecting the rise in raw material prices.
“The output of black series has shown a change from weak supply and demand to strong supply and demand. Due to the excessive destocking of the downstream manufacturing industry last year, after the holiday, there was a wave of raw material replenishment under the condition of steady growth and maintenance of work, which improved the demand for plate steel. In addition, The construction industry has picked up seasonally. The continuous increase in the output of molten iron in steel mills has also driven up the demand for raw materials such as iron ore and Shuangjiao. On the raw material side, the supply of Shuangjiao has also rebounded month-on-month after the holiday. Only iron ore supply has seasonally decreased, mainly due to Brazil’s rainy season affects the shipping efficiency of foreign mines,” said Zhou Minbo, chief black analyst at GF Futures.
Tu Weihua believes that at this stage, the characteristics of the black industry chain are that strong macro expectations continue to dominate the market trend. Under the goal of stable growth, the market has strong expectations for bullish policies, which will still support the strong operation of ferrous metals.
Inner Mongolia surface coal mine collapse has little impact on supply
A few days ago, a large-scale collapse occurred in an open-pit coal mine of Alxa Zuoqi Xinjing Coal Industry Co., Ltd. in Alxa League, Inner Mongolia, and a first-level emergency rescue response has been initiated. At present, the rescue and disposal work is progressing in an orderly manner.
It is reported that the coal mine is located in Alxa Left Banner, Alxa League, Inner Mongolia Autonomous Region, with a production capacity of 900,000 tons per year. It is an open-pit coal mine and mainly sells raw coal.thermal coaland 1/3 coking coal. According to Xinhua News Agency, Inner Mongolia is carrying out a large-scale investigation and rectification of production safety in the whole region, and is doing a solid job in safety production in various fields in the region. The Ordos Energy Bureau has issued a notice requiring all energy companies to carry out self-inspection and self-reform. At present, some coal mines have stopped production for inspection, and other major production areas have also carried out self-inspection and self-inspection activities. Prior to this, the resumption of production and work in coal mines in various places was relatively smooth, and the operating rate of coal mines quickly returned to the level before the Spring Festival. According to the start-up data of the Fenwei Coal Mine, as of this Wednesday, the operating rate of coking coal mines nationwide reached 98%, and the operating rate of coking coal mines in Shanxi, the main producing area, also stabilized at 102%.
Cao Ying, chief analyst of SDIC Anxin Ferrous Metals, told reporters that the demand side of the coking coal market is still facing the plight of downstream profits and poor orders. At present, although the long-term steel mills have gradually increased production, the coking plant is still maintaining its production due to poor profits. Low production, and steel mills and coking plants continue to adopt low raw material inventory strategies due to funding problems, which directly leads to weakness in coking coal procurement. Since the release of Mongolian coking coal imports has reached a stage bottleneck, although domestic coal mines have resumed production after the Spring Festival, due to strict self-inspection, production has not yet increased to the high level of the same period in previous years, so the coking coal market has not yet completely shaken off the main coking coal Structural supply is slightly tight and there is a pattern of excess coking coal. The accident had little impact on the supply of coking coal.
“On the demand side, after the festival, the downstream inventory replenishment efforts are average, and the inventory replenishment is mainly on-demand, so the downstream inventory continues to be low. After the accident, some traders worried about the supply problem and began to actively buy coal. In the future, some inventory will flow downstream Therefore, the spot price of coking coal rose on Thursday, and some coal types rose by 50-230 yuan/ton. Although the molten iron is still rising and steel mills are still in the process of resuming production, the recovery of terminal downstream demand is general, and raw material prices The sharp rise cannot be smoothly transmitted to the downstream, so the room for price rise is limited. Once the follow-up demand recovery is not as expected, it will negatively feed back to coking coal.” said Wang Xintong, a black researcher at Orient Securities Futures.
How will the market outlook for black products go?
For the black market outlook, Xia Xuezhao believes that the core influencing factors of the market outlook will change from optimistic expectations to the fulfillment of optimistic expectations. If most of the optimistic expectations can be fulfilled, the market will continue to be strong; if only a small part of them can be fulfilled, the market may experience a correction. The current market has actually begun to verify the optimistic expectations in the early stage, and the optimistic expectations in the market outlook may continue to reflect reality.
Zhou Minbo believes that in the short term, ferrous metal prices will remain relatively strong until the strength of demand is clear and the pressure on steel stocks is not highlighted. However, the certainty of the resumption of production of steel mills is greater than the recovery of demand, and attention should be paid to whether there is a chance of mismatch between supply and demand.
Cao Ying believes that the impact of the above-mentioned incidents is short-term and more emotional, and the downstream’s active increase in inventory has led to a rise in prices in a short period of time. Looking back at its own supply and demand, although the terminal demand for steel is recovering seasonally, the sustainability of further growth remains to be seen. After the simultaneous production increase of steel mills, the profit situation has not improved significantly, which will have different effects on raw material prices. inhibitory effect.CokeIt is also in a state of almost no production profit, and the future supply and demand are expected to improve. Since the downstream profit distribution space is too narrow, it is not appropriate to make an overly optimistic judgment. The supply increase of coking coal will be reflected after the two sessions, and will return to the weaker position in the industrial chain at that time, and will follow the rhythm of steel prices again. Therefore, the current coking coal futures prices are at an overvalued level.
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