In the last week of the May 1st, the nationwide construction steel market saw a red line across the board. The market price of construction steel in 28 major cities is almost rising. On April 25, the average prices of 6.5mm high-line and 20mm rebar in 28 cities across the country were 3510 yuan/ton and 3403 yuan/ton, respectively, compared with the previous Friday. It rose by 81 yuan/ton and 55 yuan/ton. The domestic construction steel market price has risen in an all-round way, which has led to the gradual release of previously suppressed demand. The trading atmosphere in various regions has become more active and the market inventory has further declined. It is expected that the domestic construction steel market price will continue to rise in May.
1. Analysis of resource supply
Domestic steel and wire rod production in March was 22.2202 million tons and 18.8526 million tons, respectively, an increase of 11.9% and 20.4% year-on-year respectively. In March, domestic steel and wire rod output were respectively 8.145 million tons and 6.919 million tons, which was a year-on-year increase of 20.4% and 23.3%, respectively, and the increase in production of rebar compared with the same period of last year showed a sharp rebound compared with February. In March, the average daily production of domestic steel bars and wire rods was 271,400 tons and 232,200 tons respectively, up 16.34% and 8.42% respectively compared with February. Although the output is accelerating, it is still insufficient compared to the strong demand.
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In addition, in the first quarter of this year, China's rebar output was 22.21 million tons. Combined with import and export data, the supply of rebar in the first quarter was 20.49 million tons, an increase of only 5.66%, 4.65 percentage points lower than the same period of last year, and the growth of domestic resource supply. Slow down. The domestic market demand has maintained a steady growth. In the first quarter, China's fixed asset investment growth maintained a 23.7% rapid growth despite a slight decrease compared to the same period of last year. The demand for construction steel was strong.
Due to the general launch of domestic construction projects in March and the rapid release of market demand, it can be seen from the continuous decline in domestic market for screw stocks in March that the new resources of domestic snail resources cannot meet the increase in demand. This is also the domestic demand. The continuous rise in spiral prices has laid a solid foundation. Therefore, it is not surprising that there is a shortage of resources in the domestic construction steel market. While resources are tight, the market demand for construction steel is getting better every day. According to the dealers, Wuyi will soon be coming, and now the customers who pick up the goods are significantly more than before.
2. Market inventory
The stocks of construction steel in major domestic markets continued to decline. At present, the total domestic wire stocks in 14 major cities in China are 633,100 tons, which is 85,000 tons less than that at the end of the previous year; the total amount of rebar stocks is 2,157,700 tons, a decrease of 113,900 tons compared with the previous weekend. .
Table: Changes in Construction Steel Stocks in Major Domestic Markets in April
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3, raw material prices
The domestic raw material market has risen steadily and the market trading atmosphere has become more active. The iron ore market operates smoothly. The purchase price of iron ore fines from Tangshan Steel Plant in Hebei Province remained at 780-810 yuan/tonne last week, and that of the Xingxing Steel Plant continued to be 830-870 yuan/tonne. The iron concentrate resources in Hebei Province are generally tight. Billet prices continued to rise strongly, until the weekend the price of Tangshan Pu billet was 3,100 yuan/ton, rectangular billet was 3,120-3,130 yuan/ton, 20mnsi billet was 3,150 yuan/ton, and the billet price of Zhaoxing Steel was 3080-3100 yuan/ Ton, up 50-60 yuan/ton from the previous weekend. The continuous rise in raw material prices has formed a strong supporting role for the overall trend of domestic construction steel. A dealer in Shanghai believes that the price of steel billet has been rising. The cost of construction steel will certainly rise in the later period, and the market price will certainly continue to rise. Dealers in Beijing also stated that it is more likely that the latter will increase the ex-factory price, which will also promote the continued rise of market prices in the later period.
4, the macro environment is good
On the macro level, the National Bureau of Statistics announced the operation of the national economy in the first quarter. The gross domestic product of the first quarter was 5.0287 trillion yuan, an increase of 11.1% year-on-year, and the growth rate was 0.7 percentage points higher than the same period of last year. In the first quarter, the total investment in fixed assets of the whole society was 175.26 billion yuan, a year-on-year increase of 23.7%, and the growth rate was down by 4 percentage points over the same period of last year. Among them, urban fixed asset investment was 1,455.4 billion yuan, an increase of 25.3% (up 26.8% in March), down 4.5%; real estate development investment was 3.544 billion yuan, an increase of 26.9% year-on-year and 6.7 percentage points higher than the same period of last year. The strong growth of the domestic economy has provided a strong guarantee for the growth of demand in the steel market in China. In particular, investment in real estate development has shown a momentum of accelerated rebound and has played a significant role in the demand for the construction steel market.
At the same time, with the rise in market prices, the number of steel mills that adjust the factory prices has increased significantly, and the overall increase has been the main factor. In particular, the steel prices in the South, South-West, and Northeast regions have been adjusted more frequently, which has promoted construction to some extent. Steel market prices continue to rise.
In summary, due to factors such as tight resources, reduced inventory, and rising prices of raw materials, the demand remains difficult to satisfy in a favorable macro environment. It is expected that the domestic construction steel market price will continue to rise after May 1st.
1. Analysis of resource supply
Domestic steel and wire rod production in March was 22.2202 million tons and 18.8526 million tons, respectively, an increase of 11.9% and 20.4% year-on-year respectively. In March, domestic steel and wire rod output were respectively 8.145 million tons and 6.919 million tons, which was a year-on-year increase of 20.4% and 23.3%, respectively, and the increase in production of rebar compared with the same period of last year showed a sharp rebound compared with February. In March, the average daily production of domestic steel bars and wire rods was 271,400 tons and 232,200 tons respectively, up 16.34% and 8.42% respectively compared with February. Although the output is accelerating, it is still insufficient compared to the strong demand.
In addition, in the first quarter of this year, China's rebar output was 22.21 million tons. Combined with import and export data, the supply of rebar in the first quarter was 20.49 million tons, an increase of only 5.66%, 4.65 percentage points lower than the same period of last year, and the growth of domestic resource supply. Slow down. The domestic market demand has maintained a steady growth. In the first quarter, China's fixed asset investment growth maintained a 23.7% rapid growth despite a slight decrease compared to the same period of last year. The demand for construction steel was strong.
Due to the general launch of domestic construction projects in March and the rapid release of market demand, it can be seen from the continuous decline in domestic market for screw stocks in March that the new resources of domestic snail resources cannot meet the increase in demand. This is also the domestic demand. The continuous rise in spiral prices has laid a solid foundation. Therefore, it is not surprising that there is a shortage of resources in the domestic construction steel market. While resources are tight, the market demand for construction steel is getting better every day. According to the dealers, Wuyi will soon be coming, and now the customers who pick up the goods are significantly more than before.
2. Market inventory
The stocks of construction steel in major domestic markets continued to decline. At present, the total domestic wire stocks in 14 major cities in China are 633,100 tons, which is 85,000 tons less than that at the end of the previous year; the total amount of rebar stocks is 2,157,700 tons, a decrease of 113,900 tons compared with the previous weekend. .
Table: Changes in Construction Steel Stocks in Major Domestic Markets in April
3, raw material prices
The domestic raw material market has risen steadily and the market trading atmosphere has become more active. The iron ore market operates smoothly. The purchase price of iron ore fines from Tangshan Steel Plant in Hebei Province remained at 780-810 yuan/tonne last week, and that of the Xingxing Steel Plant continued to be 830-870 yuan/tonne. The iron concentrate resources in Hebei Province are generally tight. Billet prices continued to rise strongly, until the weekend the price of Tangshan Pu billet was 3,100 yuan/ton, rectangular billet was 3,120-3,130 yuan/ton, 20mnsi billet was 3,150 yuan/ton, and the billet price of Zhaoxing Steel was 3080-3100 yuan/ Ton, up 50-60 yuan/ton from the previous weekend. The continuous rise in raw material prices has formed a strong supporting role for the overall trend of domestic construction steel. A dealer in Shanghai believes that the price of steel billet has been rising. The cost of construction steel will certainly rise in the later period, and the market price will certainly continue to rise. Dealers in Beijing also stated that it is more likely that the latter will increase the ex-factory price, which will also promote the continued rise of market prices in the later period.
4, the macro environment is good
On the macro level, the National Bureau of Statistics announced the operation of the national economy in the first quarter. The gross domestic product of the first quarter was 5.0287 trillion yuan, an increase of 11.1% year-on-year, and the growth rate was 0.7 percentage points higher than the same period of last year. In the first quarter, the total investment in fixed assets of the whole society was 175.26 billion yuan, a year-on-year increase of 23.7%, and the growth rate was down by 4 percentage points over the same period of last year. Among them, urban fixed asset investment was 1,455.4 billion yuan, an increase of 25.3% (up 26.8% in March), down 4.5%; real estate development investment was 3.544 billion yuan, an increase of 26.9% year-on-year and 6.7 percentage points higher than the same period of last year. The strong growth of the domestic economy has provided a strong guarantee for the growth of demand in the steel market in China. In particular, investment in real estate development has shown a momentum of accelerated rebound and has played a significant role in the demand for the construction steel market.
At the same time, with the rise in market prices, the number of steel mills that adjust the factory prices has increased significantly, and the overall increase has been the main factor. In particular, the steel prices in the South, South-West, and Northeast regions have been adjusted more frequently, which has promoted construction to some extent. Steel market prices continue to rise.
In summary, due to factors such as tight resources, reduced inventory, and rising prices of raw materials, the demand remains difficult to satisfy in a favorable macro environment. It is expected that the domestic construction steel market price will continue to rise after May 1st.
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