The hottest steel price has another round of rise.

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Is there another round of rise in steel prices? Analyze the trend of steel market in 2017 from the two sessions recently, the two sessions of the National People's Congress have attracted much public attention. In the previous government work report of the two sessions, the supply side has still become the focus of the market. This year, as the crucial year of supply side reform, reducing production capacity is still the primary task of the focus of supply side structural reform

in this regard, industry insiders generally expect that this year's supply side capacity reduction is expected to move further in the substantive direction, especially the production capacity of ground bar steel will be completely eliminated in the first half of the year, which will have a substantial impact on market supply, and the possibility of steel prices continuing to rise in mid and late March is still high

the reduction of steel production capacity will not be reduced

in the government work report, this year, the steel production capacity will be reduced by about 50million tons, and the coal production capacity will be withdrawn by more than 150million tons. However, due to the previous rapid rise in steel prices, the market response was flat. Last week, domestic steel prices rose sharply in the first half of the week, and some markets fell in the second half of the week. In the past two weeks, steel prices have fluctuated and consolidated as a whole, and the trend is unclear

according to this view, this year's production capacity has been expanded to the field of coal and electricity. But this year, the goal of steel capacity reduction is actually raised. The reason is that in addition to the goal of reducing steel production capacity this year, which is 5million tons higher than last year, there are also intermediate frequency furnaces to be completely removed by the end of June. Compared with the target of 45million tons last year, it is more radical

insiders pointed out that on the one hand, the policy signals of deleveraging and anti inflation are constantly coming out at the macro level, and the huge profits accumulated by steel traders' inventory resources need to be cashed out, so there are many obstacles to the continued rise of futures prices; On the other hand, the policy of de capacity continues to work, the spot trend continues to be strong, and the price difference between futures and cash is at a high level, which restricts the downward space of futures prices

from the current situation, increasing the pace of capacity removal may lead to an increase in steel prices. But now iron ore and steel inventories hit new highs, indicating that the current bullish is market expectations, and the actual demand has not increased significantly. However, the future price performance still depends on the changes in the relationship between supply and demand

what is the trend of steel in 2017? It is expected to see a new round of rise

at present, the inventory in the domestic market has entered the digestion stage, and the inventory of steel mills is generally low. If the demand in March and April is not falsified, there may be a certain local gap in the supply level after entering the peak season, which increasingly shows its uniqueness. Therefore, on the whole, analysts believe that the main reason for the short-term decline in steel prices is to improve the printing situation, avoid policy risks and stabilize the excessive profits of manufacturers. The possibility of a sharp decline is very small. After the release of the risk of price correction, domestic steel prices are expected to rise again in mid and late March

industry insiders predict that the steel de capacity will continue to increase in the year of 606.57, and the main focus will be on promoting enterprise mergers and acquisitions, removing steel bars, and effectively disposing of "zombie enterprises". The expectation of market supply contraction caused by the promotion of de capacity may still be the main driving force behind the rise in domestic steel prices

in the macro aspect, while proposing to reduce the production capacity of steel and coal, the government work report also proposed to eliminate, suspend and delay the construction of coal power production capacity of more than 50million kW with a high degree of automation, so as to prevent and resolve the risk of excess capacity of coal power, improve the efficiency of coal power industry and make room for the development of clean energy

however, some relevant institutions believe that the domestic steel price soared to a new high in recent four years during the traditional consumption off-season in January and February, which has largely overdrawn the expectation of good supply and demand in the peak season. Many steel traders need to cash in the accumulated profit space of inventory resources, and the steel price will be a volatile situation in the short term

from the analysis of the trend of steel in the later stage of the two sessions, the actual impact on the two aspects of steel supply and demand is not reflected overnight, but the actual supply side to capacity will continue to strengthen, the infrastructure investment situation is not great, but the actual demand may increase, and the impact on the steel price is mostly in the mentality in the short term. Because there is no big positive data released, the wait-and-see mentality has increased significantly

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