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Oversupply may still restrain the domestic steel price rise in the second half of the year

oversupply may still restrain the domestic steel price rise in the second half of the year

China Construction machinery information

several major factors affecting the steel market trend in the first half of the year

the effectiveness of the "micro stimulus" policy appears, and the economic situation in the second quarter is better than that in the first quarter. In the first half of this year, China's GDP (gross domestic product) increased by 7.4% year-on-year, of which the economy grew by 7.5% in the second quarter, an increase of 0.1 percentage points over the first quarter. In the first half of 2014, the central bank strengthened the regulation of interbank business of financial institutions, restricted the flow of on balance sheet platform loans and urban investment bonds to real estate and local financing platforms, and the year-on-year growth rate of infrastructure construction and real estate development investment fell significantly, thereby affecting the demand of household appliances, construction machinery and other industries. In order to ensure that the economy operates within a reasonable range, since April, the government has successively introduced a number of "micro stimulus" steady growth measures, such as targeted RRR reduction, streamlining administration and decentralization, and promoting financial support for the real economy, which gradually showed their effects in May and June

the output is still at a high level, and the market supply-demand relationship needs to be balanced. In the first half of 2014, the average daily output of domestic crude steel was still rising month by month. In the first five months, the national average daily output of crude steel reached 2.2683 million tons. In June, the average daily output of crude steel reached a new high of 2.3097 million tons, an increase of 1.66% over the previous month. However, different from previous years, the average daily output of crude steel of non key steel enterprises fell month by month in 2014. From March to March, the protection of the grinder was divided into three levels: normal protection, and protection and level 2 protection, which were 530900 tons, 515900 tons and 495900 tons respectively in may. The average daily output of crude steel of key steel enterprises rose month by month, reaching 1.7352 million tons, 1.7752 million tons and 1.776 million tons respectively from March to May; In late June, the average daily crude steel output of key steel enterprises was 1.7781 million tons, down 3.2% from the middle

when the crude steel output of the upstream steel plant continues to hit a new high, the steel inventory continues to decline, and the current inventory level has been below 14million tons, which shows that the actual demand is acceptable. On the one hand, since the beginning of this year, China's steel exports have improved. Although the national steel exports in June were 7.07 million tons, a month on month decrease of 1million tons, the new material resource sharing platform construction plan was formulated and implemented, with a decrease of 12.4%, but the steel exports in may hit a record high of 8.07 million tons, effectively alleviating the supply pressure of the domestic steel market; On the other hand, the commencement of a series of large-scale projects is achieved through the direct supply of steel mills, resulting in weak delivery in the spot circulation market

the price of raw materials fluctuated and fell, and the cost support gradually decreased. In the first half of this year, the market price of raw materials went out of a volatile downward trend. Among them, the price of iron ore and steel billets fell significantly, while the price decline of coking coal and scrap steel was relatively moderate, but most of them fluctuated at the bottom. In the first half of this year, the trend of steel prices and raw material prices affected each other, and the continuous decline of raw material prices also became one of the main reasons for the continuous decline of steel prices during this period

according to the price trend of Newman fine ore with a grade of 62.5% in Qingdao port, iron concentrate with a grade of 66% in Qian'an, Hebei Province, and primary metallurgical coke in Changzhi, Shanxi Province, the highest prices of the above three raw materials in the first half of this year all occurred at the beginning of the year. The price of imported ore was 920 yuan/ton, that of domestic ore was 1070 yuan/ton, and that of metallurgical coke was 1410 yuan/ton. After that, the price of imported ore fell violently and fell below 700 yuan/ton on May 23. At the end of June, the price fell to 640 yuan/ton, a decrease of 30% in the first half of the year. In terms of the price of domestic ore, it has been showing a relatively stable decline from 1070 yuan/ton at the beginning of the year. The price was 820 yuan/ton at the end of June, down 23% from the beginning of the year. In terms of metallurgical coke price, it began to decline from 1410 yuan/ton at the beginning of the year, with a large range. It began to stabilize from the end of March to the beginning of April, and the price fell to 1040 yuan/ton at the end of June, with a decrease of 26% in the first half of the year

oversupply will still curb the rise in steel prices in the second half of the year

in the second half of the year, the government will continue to adjust the economic structure, accelerate the pace of comprehensively deepening reform, and introduce "micro stimulus" policies to stabilize economic growth, but the pull of relevant policies on market demand is limited, especially when the real estate market is facing deep adjustment. Insiders predict that the steel price of 201 Jinan gold testing tensile machine may fluctuate in the second half of the fourth year, and some steel prices will rebound periodically during the period of warming terminal demand

in addition, the market supply pressure in the second half of the year should not be underestimated. According to the usual situation, the daily output of crude steel in China usually peaked in the second quarter and began to decline in the third quarter. However, due to the serious overcapacity in the steel industry and the decline in raw material prices in the first half of this year, the profitability of steel enterprises has improved slightly, and the production enthusiasm has not decreased. It is expected that the market supply pressure will remain high in the second half of this year. In terms of demand, in the second half of the year, the government will strengthen the implementation of the "micro stimulus" policies that have been introduced, especially in the reconstruction of shanty towns and railway construction, which will become the highlight of demand, but the support is relatively small, and the boosting effect on demand is not obvious

at the same time, in 2014, banks tightened credit to real estate and overcapacity industries, while the targeted RRR reduction implemented in the second quarter had a limited impact on the above industries, resulting in a general tight capital in the steel industry chain and the use of "future" materials to meet more future industrial demand. In the second half of 2014, the banking industry will still control loans to industries with high pollution, high energy consumption and serious overcapacity, and the shortage of funds in the steel industry will continue