Experts say the city - May 19

My Steel: In terms of supply, the total supply of major steel products last Friday was 8.8369 million tons, a decrease of 0.0582 million tons week-on-week, down 0.7%. Last Friday, the output of major steel products decreased except for rebar and medium and thick plates. The core driver was steel plant maintenance and unsaturated production. In terms of inventory, the total inventory of major steel products last Friday was 14.3066 million tons, a decrease of 0.4541 million tons week-on-week, down 3.1%. Last Friday, except for rebar and hot-rolled coils, the total inventory of major varieties increased: factory inventory decreased week-on-week, with the decrease mainly contributed by hot-rolled coils. Social inventory decreased week-on-week, with the decrease mainly contributed by rebar. In terms of consumption, the weekly consumption of major varieties last Friday was 9.1376 million tons, an increase of 8% week-on-week; among them, the consumption of construction materials increased by 16.2% week-on-week, and the consumption of plates increased by 5.2% week-on-week. Last Friday, the apparent consumption of major varieties showed an increase in both construction materials and plates. Currently, pig iron production is still running at a high level, and steel mills are still profitable. Under the condition of still having some profits, the scale of production reduction is expected to be limited, and production may still run at a high level. Although there is still resilience at the bottom of demand, the off-season is approaching, and there is an expectation of a decline in demand. The supply and demand of steel are showing a marginal weakening trend. In terms of raw materials, steel mills have started the first round of price reductions for coke. At present, coke profits are still considerable, and steel mill profits have narrowed. It is expected that there will be further room for price reductions in the future, and short-term raw material support may weaken. Overall, macroeconomic uncertainties still exist, and there is an expectation that the industrial supply and demand pattern will weaken. The short-term upward space for steel prices may be limited.

Steel Home: After the positive effects of the high-level China-US economic and trade talks faded, the market will return to fundamentals, and oversupply will be the main problem facing the market. First, steel mills have high production enthusiasm, the blast furnace operating rate remains above 90%, and the electric furnace operating rate continues to rise. In early May, the crude steel output of key steel enterprises increased slightly both year-on-year and month-on-month. Production restrictions have not been implemented, and given the profitability of steel mills, the possibility of implementation in the future is also low; second, downstream demand is shifting from peak season to off-season, and expectations of weakening demand are increasing. Merchants are mainly operating with low inventory and inventory reduction; third, the cost support of steel is weakening, the first round of price reduction of coke has been implemented, and iron ore has demand support, but there is no upward momentum. Overall, the current market shows the characteristics of high output, low expectations, and weak balance. It is expected that the domestic steel market price will mainly decline slightly this week. The interfering factors are still the progress of China-US trade negotiations and the impact of crude steel reduction policies.

Lange: Currently, the momentum of global economic growth is insufficient, trade protectionism is rising, and geopolitical conflicts continue to exist. The foundation for the continued recovery and improvement of China's economy still needs to be further consolidated. We need to strengthen the coordination and cooperation of macroeconomic policies, expand domestic demand, stabilize expectations, stimulate vitality, flexibly grasp the intensity and rhythm of policy implementation, maintain ample liquidity, and make the growth of social financing scale and money supply match the economic growth and expected price level targets. The first interest rate cut and reserve requirement ratio cut of the year have been implemented, and coupled with the "temporary suspension" of the China-US tariff war, this will bring a phased "recovery period" to the global trade market, thereby consolidating the growth momentum of the domestic economy. From the perspective of the black commodity futures market, the black commodity futures market generally fell on Friday, with the main contract of coking coal falling by 3.84%, dragging down the entire black commodity market. Rebar and hot-rolled coils finally fell by 1.15% and 0.95%, respectively. From the perspective of the main 10 contract of rebar, it closed at 3082, down 36 points daily, up 60 points from the closing price last Friday, and the weekly settlement price was 3089, up 11 points. From a weekly perspective, last week generally showed a rebound, with a range of 119 points from the lowest to the highest, but it fell back and adjusted on Thursday and Friday. The weekly line unfortunately failed to close above the opening price last week. Although there was a rebound, the momentum was insufficient. This week, we will continue to pay attention to whether the starting point of the rebound on Wednesday last week, around 3070, can be effectively supported. If it is effectively supported, there is still room for a rebound, and the upper pressure is around 3150-3180. Otherwise, it will maintain the fluctuation between the low and high points of last week. From the perspective of the steel spot market, on the supply side: due to the "profit effect," the intensity of steel mill capacity release has weakened, and pig iron production has slightly decreased, while the output of various products has varied. On the demand side: due to the easing of the China-US tariff war, market speculation and the release of effective terminal demand have been activated, and the market transactions of various products have increased significantly. On the cost side: due to the slight increase in iron ore prices, the slight increase in scrap steel prices, and the stable coke prices, the support of production costs has turned from weak to strong. Therefore, the Lange Steel Research Center predicts that under the influence of the easing of China-US relations, the increase in incremental policies, the weakening of supply release, the gradual emergence of the off-season effect, and the shift of costs from weak to strong, the domestic steel market this week (2025.5.19-5.23) may maintain a weak trend.

Tang Song: This week, as the positive news from the China-US tariff negotiations temporarily came to an end, and domestic favorable policies are being launched or are in a blank period, the support of macroeconomic news for the market has weakened, and the leading black commodity futures and spot market may gradually shift to fundamental logic. Entering the second half of May, there has been an increase in widespread heavy rainfall in both the north and south, and outdoor construction may be affected. Rebar demand has gradually entered the traditional weakening stage, and it is difficult for the demand to increase significantly; the demand for strip steel in the processing and manufacturing industry remains at a high level; there are signs of a decrease in direct steel exports; and market trade speculation demand may decrease. The overall rigid demand for steel this week may remain at the same level as last week, and the characteristics of the approaching off-season may be slightly apparent. From the supply side, the operating rate of long-process blast furnaces is stable at a high level, and the output of major products such as coils and strips is mainly stable; the operating rate of independent electric furnace production lines and the output of rebar may gradually stabilize. The decline in steel inventory is slowing down, and the decline in inventory of major varieties varies. There is no obvious contradiction between supply and demand. Although the current steel fundamentals are good, the improvement in the China-US tariff confrontation, and the temporary weakening of the tariff war's disturbance to the black market, with the arrival of the rainy season, the actual demand for domestic construction steel has gradually entered a weakening period, and the growth of domestic demand has entered a stagnation period. At the same time, the impact of tariff policies in other countries on China's steel exports will be reflected. The overall apparent demand for steel this week is difficult to increase. Currently, pig iron production has reached a high level, and steel mills still have the motivation to increase production, and supply-side pressure may be reflected. In particular, it is difficult to implement crude steel control policies, and the entire market lacks the conditions to strongly support price increases. Market confidence is weakening, and cautious sentiment may increase. In addition, coke prices continue to be weak, and the cost support for steel is weakening, making it more difficult for futures and spot prices to rise. Overall, the market is currently in an observation period to see whether the market has peaked and turned weak. It is expected that the futures and spot prices of major varieties this week may fluctuate and adjust. For the iron ore futures, the support below is 3073 and 3060, and the pressure above is around 3150 and 3164.

Han Weidong, Youfa Group: All external factors that interfere with the market have been clarified, and the market has returned to fundamentals. Currently, the output of the steel industry is too high. What supports the current market price is that the demand is still good, but once the off-season arrives and demand decreases, the market price will decline until steel mills reduce production. However, because the prices of raw and auxiliary materials and steel are at low levels, the total social inventory is at a low level, and there are expectations of production restrictions in the second half of the year, so the downside space is not particularly large. Let's cherish the moment!