Experts say the city - April 7

My Steel: On the supply side, the supply of major steel varieties last Friday was 8.7252 million tons, a week-on-week increase of 30,200 tons, or 0.3%. Steel production saw a slight rebound this period, mainly concentrated in the more significant increase in the output of medium and thick plates; the total inventory of major steel varieties last Friday was 16.9009 million tons, a week-on-week decrease of 477,200 tons, or 2.7%. The total inventory of major varieties last Friday decreased, and the changes in the inventories of construction materials and plates remained consistent, with both construction materials and plates showing destocking. In terms of consumption, the weekly consumption of major varieties last Friday was 9.2024 million tons, with construction material consumption increasing by 0.1% week-on-week and plate consumption remaining flat. The consumption changes of construction materials and plates among the major varieties last Friday showed some divergence. On the supply side, due to compressed profits, some companies have begun to actively reduce the output of rebar, and the short-term peak output may appear. There is an expectation of reduced production of rebar in the future. The output of hot-rolled coils may still rebound after short-term maintenance this week, and the supply pressure is relatively large; in terms of inventory, rebar and hot-rolled coils are expected to continue seasonal destocking this week. In terms of demand, the apparent consumption of rebar and hot-rolled coils is expected to remain at a high level of fluctuation this week, but the peak of apparent demand for hot-rolled coils may have already appeared. As the peak demand for steel is about to appear, the overall inventory pressure will gradually increase, and some regions have already seen an increase in inventory. We need to pay attention to the speed of steel destocking and when the inflection point of inventory accumulation will appear.

Steel Home: Last week, domestic steel market prices mainly fluctuated slightly, with a trend of falling first and then rising. From the recent market perspective, favorable factors include: firstly, the National Development and Reform Commission and the joint meeting have continuously held meetings to implement previous policy measures, and the Ministry of Finance has issued special government bonds to supplement the capital of commercial banks, which is conducive to further boosting consumption and market confidence; secondly, the manufacturing and construction PMI continued to rebound, coupled with increased efforts in the trade-in program and the peak season for construction consumption, the short-term demand growth expectation is relatively strong; thirdly, steel costs have some support, iron ore prices continue to fluctuate within a range, and coke prices have a trend of stabilizing and rising. Unfavorable factors include: firstly, relevant national departments have issued an announcement that they will elevate the crackdown on export tax evasion from past sporadic actions to the level of laws and regulations, which has a positive role in cracking down on "buying orders for export" and regulating steel export behavior, but it will also affect steel exports in the short term; on April 2, the United States announced equivalent tariffs, raising market risk aversion sentiment, especially having a greater impact on the capital market; secondly, the increase in trade friction incidents will gradually show its impact on China's steel export orders. It is expected that domestic steel market prices will continue to fluctuate slightly this week.

Lange: Due to the US "equivalent tariff" measures, external pressure has increased again, but the current economic recovery is more obvious, and the comprehensive effectiveness of multiple policies to expand domestic demand is further manifested, and the recovery of production is quite obvious. However, it should be noted that the problem of oversupply is still prominent, and enterprises still lack confidence in resuming production. Driven by policies, the economy has shown an initial recovery trend, but the foundation is still unstable. It is necessary to continue to increase the intensity of macroeconomic counter-cyclical regulation, especially to significantly strengthen the key role of government investment in public products in expanding domestic demand, and to persistently and quickly change the market-guided trend of demand contraction. From the perspective of the black commodity futures market, the black commodity sector as a whole closed slightly lower, maintaining a weak state. The main 05 contract of rebar closed at 3164, down 6 points daily and 33 points weekly, with a weekly settlement price of 3165, down 33 points. The latest open interest is 1.118 million lots, a decrease of 435,000 lots from last Friday. Currently, the 05 contract is fluctuating at a low level, and the daily and weekly line structures are slightly better than the 10 contract. The premium structure of the 10 contract after the festival will face some pressure. The 10 contract should pay attention to the pressure level of 3250-3300 above. From the perspective of the steel spot market, on the supply side: due to the impact of profit and loss on different varieties, the intensity of capacity release continues to increase, and pig iron production continues to increase, while the output of various varieties has slightly decreased. On the demand side: although steel mills and social inventories continue to decrease, and the overall transaction volume of various varieties remains upward, the pre-holiday inventory replenishment demand is less than market expectations. On the cost side: due to the steady decline in iron ore prices, the slight decline in scrap steel prices, and the stable coke prices, the support of production costs has changed from strong to weak. Therefore, the Lange Steel Research Center predicts that under the influence of the repeated use of tariff sticks, the significant recovery of the domestic economy, the continuous increase in supply release, the lower-than-expected inventory replenishment demand, and the change of cost support from strong to weak, the domestic steel market will continue its weakening trend this week (2025.4.7-4.11).

Tang Song: This week is the Qingming Festival period, with reduced working days and trading volume. However, with the arrival of the most favorable "Silver April" construction and steel demand season, construction projects nationwide have entered the full construction stage, and rebar demand may reach its peak; the demand for strip steel from processing and manufacturing enterprises remains stable; the overall rigid demand for steel remains relatively stable during the week. From the supply side, the operating rate of long-process blast furnaces remains high and stable, and the incremental space for the output of major products such as coils and strips is narrowing; currently, independent electric arc furnace production lines in the south are in a state of profit and loss, and the operating rate of production lines may remain basically stable, with a slight increase or decrease in rebar production. Steel inventories are maintaining a slow downward trend, with inventories of major varieties slightly decreasing, but the destocking rate of rebar and coils differs, and the actual supply-demand relationship continues to improve. With the implementation of tariff policies, the black commodity sector as a whole has performed relatively steadily, mainly due to the completion of the previous market pricing and trading. The possibility of the market continuing to weaken significantly in the short term is reduced. After entering April, both market supply and demand are expected to continue to grow, which will provide some support to the market. With the implementation of tariffs, the country's "second-hand" stimulus policies are expected to be introduced, which may boost market confidence in stages, but considering the possibility of market fluctuations before the implementation of differentiated tariffs on April 9, and the high steel output will also continue to suppress the market's upward momentum. Overall, it is difficult for steel to show a clear trend direction in the short term. Especially without triggering crude steel control, even if stimulus policies are introduced in the short term, even if the market rises, the space is likely to be limited. In terms of technical analysis: key points to pay attention to: for the 10 contract of rebar futures, attention should be paid to the resistance level around 3260; for the 05 rebar contract, attention should be paid to the resistance level around 3190. If it can effectively break through, the market is expected to get rid of the weak fluctuation and turn to a fluctuation and strengthening trend.

Han Weidong, Youfa Group: The US's imposition of tariffs on the whole world has brought systemic risks. In the face of systemic risks, fundamentals sometimes lose their role temporarily. We need to take this seriously. A wise man does not stand in the path of danger! The next step is to consider the impact on direct and indirect steel exports. In the past five months, the unexpectedly high year-on-year growth in demand and the positive changes in macroeconomic policies have been supporting steel prices and steel mill profits. The next step is to focus on changes in demand from the fundamental perspective, and from the macroeconomic perspective, to observe the countermeasures of various countries to the US's imposition of tariffs and the continuous reaction of the global financial market to this event. Domestically, we should pay attention to China's response strategies and the support for internal circulation. In the days to come, in addition to large-scale supply-side reforms, let's temporarily abandon the idea of gambling on the market.