Inventory of the seven major factors affecting the steel market in October

In September, the steel market, under the policy of “stabilizing politics, stabilizing the economy, and maintaining confidence”, has turned the beacon of hope for steel traders, and with the help of QE3 launched in the United States, it has ignited the passion of the market and steel prices. Out of a wave of strongest rebound this year.

Recently, the intensive introduction of favorable policies at home and abroad has provided a psychological boost to the steel market. The seasonal demand for steel products has rebounded. The social inventory is at a low level. The demand for rescheduling between middlemen and end users also brings about the increase in steel prices. Certain support. In the steel market in October, if the increase in substantial demand cannot be released more clearly, the steel price will experience a fluctuating operation and a long and weak plateau. Otherwise, in this encouraging “Red October” steel The price is expected to come out of a small, sustained rebound.

Factors affecting the operation of the domestic steel market:

1. The output of steel fell slightly and there was a sign of recovery in the later period.

According to the latest data from the China Iron and Steel Association, the average daily output of crude steel for major and medium-sized enterprises in mid-September 2012 was 1.522 million tons, down 2.73% month-on-month, and the average daily crude steel production in mid-September was estimated to be 1.856 million tons. Decline by 2.01% from the previous quarter.

2, iron ore spot prices will be strong.

According to data from the China Steel Network, the price of imported iron ore rose as a whole on the first working day after the National Day (8th), and the number of inquiries in the morning increased significantly. Individual merchants' prices increased by 20-30 yuan/ton, but large-scale traders intentionally raised prices. 50 yuan or so. Some large traders have not issued the latest price yet, but their willingness to raise prices is strong. As for the steel mills, some billet enterprises in the north already have a profit of RMB 100-150/ton, and the procurement of raw materials is relatively positive. Therefore, it is expected that the price of imported iron ore will also rise as a whole for some time.

In March and September, the PMI index of the steel industry picked up.

According to the latest data released by the China Logistics and Purchasing Federation’s Steel Logistics Professional Committee, the PMI index for the domestic steel industry in September was 43.5%, a rise of 3.6 percentage points from the previous month, which was a departure from the nearly 45-month low recorded in August.

In addition, the latest data from the China Iron and Steel Association shows that in mid-September, the average daily steel sales of 76 key steel companies rose by 7.56% from the middle of August, exceeding the average sales volume of the year. The new export order index for the steel industry also continues to rebound.

4. The economic growth at home and abroad slowed down, and the policy side appeared positive.

Recently, strong policies at home and abroad have provided psychological support to the steel market. On the 6th of September, the European Central Bank issued the “Direct Currency Trading (OMT)” plan to purchase unlimited sovereign bonds of eurozone member states. The Sept. 14 announcement was announced by the Federal Reserve. Start the third round of QE3.

5. The growth rate of downstream industries will slow down, and seasonal demand for steel products may pick up.

From January to August, the country’s investment in fixed assets increased nominally by 20.2% year-on-year, and the growth rate fell 0.2% from January to July. In August, the year-on-year growth rate of fixed asset investment in the country fell below 20% to 19.36% for the second time this year. From January to August, investment in real estate development in the country increased nominally by 15.6% year-on-year, and the growth rate increased by 0.2 percentage points from January to July. The area of ​​new housing starts fell by 6.8%, a decrease of 3 percentage points from January to July. The real estate market is still under severe control. However, the seasonal demand growth in the short term may drive the growth of steel product demand. From January to August, the railway fixed asset investment decreased by 24.1% year-on-year, of which capital construction investment decreased by 28.0% year-on-year, and the decrease was 5.9% and 5.5%, respectively, from January to July. Recently, the Ministry of Railways once again increased the railway infrastructure investment by 90 billion yuan. With the implementation of funds in the later period, the railway construction will speed up.

6. It is worth mentioning that the question of steel trader capital chain is that after entering October, the repayment period of the bank began to appear. It is difficult for the steel industry to obtain “blood transfusion” from banks. The steel industry wants to be in the next few months. It may be difficult to continue "restoring" in China.

7. Declining steel stocks in society The sharp decline in steel stocks, corresponding to the rapid rebound in steel prices in early September. According to the latest inventory data, as of the week of September 21, the five major steel products (rebar, wire rod, hot-rolled coil, cold-rolled coil, and plate) in 26 major markets across the country had a social inventory of 13.065 million tons. There has been a fall for the 9th consecutive week, setting a new low this year. It is worth mentioning that the total steel inventories in the week of September 21 fell by 66.4 million tons, which is the seventh largest decline in history since the data was counted in the week of April 9, 2010. The two major weeks fell.

In summary, recently, the intensive introduction of favorable policies at home and abroad provided a psychological boost to the steel market. The seasonal demand for steel products rebounded. The social inventory was at a low level. The demand for middlemen and end-users to make up for the short position was also given. The rise in steel prices has given some support. However, the current economy is still in a steady state trend. The short-term policy is not conducive to the actual consumption of steel products. There is no significant improvement in the major steel industry; steel production has shown signs of recovery, and late price rebounds or stimulates the release of production capacity. October is the traditional peak season for demand. It can be predicted that the supply and demand relationship of the steel market will improve in October this year, but it is difficult to see a significant increase.