2024-10-16
After the holiday, the steel market did not go out of the direction to pay attention to prevent late risks.
Half of October has passed, but the steel market still has no clear direction, and steel prices are still in a volatile trend, causing some traders to be restless. Today, the main rebar contract closed at 3502 points, up 47 points, or 1.36 percent; the average price of grade III rebar (Φ25mm) in Lange Steel Network was 3863 yuan/ton, up 15 yuan/ton from the previous trading day.
Since September, under the stimulation of a series of macro policies, the market mentality has been effectively boosted. After entering October, the macro favorable policy stimulus is still continuing. Last Saturday, the Ministry of Finance held a press conference and stated that it will launch a package of incremental policies in terms of increasing support for local governments to resolve government debt risks and issue special bonds. Today, the Ministry of Industry and Information Technology stated that in the fourth quarter, it will work with relevant departments to launch a batch of specific measures to promote consumption and expand domestic demand. It mentioned that industrial projects are expected to drive investment of more than 11 trillion yuan in the next three years. Driven by policy, demand is expected to continue to strengthen.
However, it is worth noting that it takes a certain period of time for the policy to be effective, especially the implementation of fiscal policy requires a series of procedures, and it is likely to take effect until next year. Secondly, to increase efforts to resolve local debt, mainly to solve the problem of pre-debt, for the late borrowing put forward the requirement of not large-scale illegal borrowing, that is to say, the main optimization is the stock of projects, and the increment is relatively limited. Today, the industrial sector projects proposed by the National Development and Reform Commission have driven investment of more than 11 trillion yuan, with a time period of 3 years. Therefore, the macro policy brings more emotional benefits. In fact, the demand for the fourth quarter of this year is relatively limited.
On the supply side, with the rebound in steel prices, the profits of steel mills have recovered significantly, the enthusiasm for production has increased significantly, and there are signs of continuous expansion of production. According to the calculation of Lange Steel Network Research Center, on October 11, the profit of Grade III rebar in stock reached 475 yuan/ton in two weeks.
According to Lange Steel Network's research, at present, the production lines of thread rolling in Hebei are basically starting to produce, and some long-process steel mills in some areas have switched the rolling lines to more profitable rebar. In terms of electric furnaces, electric furnace plants in Fujian have basically resumed production. After stopping production for two consecutive quarters, electric furnace plants in Guangxi are now gradually recovering. Therefore, it is not ruled out that the production of rebar in October and November has increased significantly.
Inventories have also begun to pick up. According to the latest data from the China Iron and Steel Association, in early October, the social inventory of five major varieties of steel in 21 cities was 7.63 million tons, an increase of 150000 tons or 2.0 percent from the previous month. This is the first increase in social inventory after 80 consecutive decades of decline; an increase of 340000 tons or 4.7 percent over the beginning of the year. However, the current inventory is still 1.61 million tons lower than the same period last year, down 17.4 percent, and the overall social inventory pressure is still not great.
In addition, the overseas situation is more serious, geopolitical conflicts intensified. This may be a disturbance for global commodity markets.
On the whole, the current macro policy residual temperature still exists, but the market fundamentals have quietly changed, pay attention to the risks brought by production growth. Focus on whether the recent project began to rush work, as well as the introduction and landing of the succession policy. In the short term, the domestic steel market showed a volatile upward trend.
Experts say the city-November 21
2024-10-21
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