"There is no doubt that the sudden COVID-19 epidemic is the dominant factor in the trend of the steel market in the first half of this year." Zhang Qiusheng first pointed out the "fuse" of steel market fluctuation in the first half of this year.
First, from a macro perspective, "epidemic+'oil war'" has accelerated the global economic recession. In the first half of the year, the overseas epidemic spread and the global economy declined. With the implementation of counter-cyclical adjustment measures such as "expanding finance, widening currency, reducing taxes and fees, strengthening investment and promoting consumption", China's GDP growth rate in the second quarter turned from negative to positive, with a year-on-year increase of 3.2%. "Since the outbreak of the epidemic, China's economic recovery has been ahead of the world." Zhang Qiusheng said.
Second, from the perspective of supply, the supply of crude steel abroad has decreased, while the domestic supply has increased. In the first half of the year, the global crude steel output reached 870 million tons, down 6% year-on-year. Among them, the output of crude steel in China is about 500 million tons, up by 1.4% year-on-year. By the end of June, the national blast furnace operating rate rose to 9 1.8%, up 4.3% year-on-year, a record high.
Third, from the demand point of view, the demand in the first half of the year was weak first and then strong. The epidemic delayed the release of demand for about two months. In the second quarter, the downstream construction site entered the final stage, the demand for construction steel was released rapidly, and the market turnover remained high. In June, due to the continuous heavy rainfall in the south, the demand for construction steel declined seasonally, but the manufacturing industries such as automobiles, construction machinery and household appliances continued to improve, with strong demand resilience.
Fourth, from the point of view of inventory, the situation of high inventory has curbed the rise of steel prices. After the Spring Festival this year, the inventory of five kinds of steel products continued to increase. By mid-March, the steel inventory reached 389 1 10,000 tons, a record high. With the accelerated release of demand, steel inventory continued to decline 14 weeks later, it rose again. By the end of June, the inventory of five kinds of steel reached 20.53 million tons, an increase of 4.37 million tons, an increase of 27%.
Fifth, from the cost point of view, the price of raw fuel first fell and then rose. In the first quarter, affected by the epidemic, raw fuel prices fell sharply, scrap prices fell by 500 yuan/ton, coke prices fell by 250 yuan/ton, and iron ore prices fell below $80/ton. In the second quarter, with the rise of steel prices, the output of steel mills increased significantly, and the supply of raw fuel was tight, which led to a sharp increase in iron ore prices, breaking through the 1 10 USD/ton mark; The price of coke rose for 6 rounds, with a cumulative increase of 300 yuan/ton; The price of scrap steel rose by 480 yuan/ton. Generally speaking, the price of raw fuel was higher than that of steel in the first half of the year, which is one of the reasons for the low profit of steel mills.
Sixth, from the price point of view, steel prices are rising gradually. In the first half of the year, steel prices first fell and then rose, and then gradually rose after entering the second quarter. In the first half of this year, compared with the same period of last year, the average price of rebar fell by 369 yuan/ton, a decrease of 9.4%; The average plate price dropped by 24 1 yuan/ton, down by 6.1%; The average price of hot-rolled coils fell by 294 yuan/ton, a decrease of 7.6%; The average price of strip steel fell by 297 yuan/ton, a decrease of 7.7%.
2. High inventory will remain the market norm in the second half of the year.
"With the help of macro benefits, the demand in the second half of the year will be better than that in the first half." Zhang Qiusheng made a judgment on the market prospect. "At the same time, factors such as strong steel prices and increased supply have made steel mills' demand for raw fuel undiminished, raw fuel prices are relatively firm, and steel mills' profits may remain low."
First, the domestic economy will accelerate its recovery. In July, the purchasing managers' index (PMI) of China's manufacturing industry was 5 1. 1%, up 0.2 percentage points from the previous month, and it was above the threshold (50%) for five consecutive months. Zhang Qiusheng believes that in the second half of the year, the tone of China's economic progress will not change, and the counter-cyclical adjustment will continue to increase. It is estimated that the GDP growth rate in the fourth quarter is expected to reach around 6%.
Second, the supply pressure of crude steel has not decreased, and it peaked in the second half of the year. It is embodied in three aspects: the output of long-process steel mills has peaked, and there is little room for further increase. According to industry statistics, as of July 3 1 day, the blast furnace operating rate of 247 steel mills nationwide reached 9 1.2%, up 4.4% year-on-year; The operating rate of 7 1 short-process EAF steel plant reached 72.7%, down 0.9% year-on-year. Zhang Qiusheng said that the current blast furnace operating rate has reached a record high, and it is expected that there will be limited room for further growth. In the second half of the year, the output of crude steel will peak and fall back, and the operating rate of electric furnace will remain at 60% ~ 70% in the second half of the year. The annual output of crude steel and pig iron is expected to reach 65.438+0.5 billion tons and 870 million tons.
Third, the import and export pressure has shifted to China, and the market supply pressure has increased. In the first half of the year, China exported 28.704 million tons of steel, a year-on-year decrease of 5.654 million tons, a decrease of 65.438+06.5%; Steel imports totaled 7.343 million tons, up 6.5438+0.52 million tons year-on-year, up 2.665438+0%; Billet imports totaled 5.537 million tons, up 5.03 million tons year-on-year, up 99.2%. Among them, the import of steel billets in June reached 2.484 million tons, a year-on-year increase of 22.37%, a record high. Zhang Qiusheng predicted that China's steel exports will continue to decline and imports will continue to increase in the second half of the year, which will increase the supply pressure in the domestic market.
Fourth, the demand in the second half of the year will be better than that in the first half, and the growth rate of demand will be stronger than that of supply. The demand in the second half of the year mainly involves the following aspects:
Major water conservancy projects will become new demand growth points in the second half of the year. Frequent floods this year have caused a large number of houses to collapse and damaged infrastructure such as bridges and highways. After the flood, post-disaster reconstruction and 150 major water conservancy projects will bring new growth points to the demand for steel for buildings, bridges and other projects.
The new and old infrastructure will work together, and the annual infrastructure growth rate is expected to reach more than 10%. Since the National People's Congress proposed to strengthen the construction of "two innovations and one heavy" (new infrastructure construction, new urbanization construction, transportation, water conservancy and other major projects) this year, 26 provinces (autonomous regions and municipalities directly under the Central Government) have issued policy documents specifically aimed at "two innovations and one heavy", and local investment policies will gradually land.
The demand for real estate steel will increase. With the end of the rainy season in the south, in August, real estate will usher in a "rush to work". The real estate market will pick up moderately in the second half of the year, and the demand for real estate steel will increase slightly.
The demand for steel in automobile and home appliance industries will increase slightly, but the growth space is limited. As the country continues to increase the stimulus to the consumption of automobiles and household appliances, the sales of automobiles and household appliances will maintain a slight growth trend in the second half of the year. However, due to the global economic downturn, blocked exports and other factors, the sales growth of automobiles and household appliances is limited, which in turn affects the demand for steel.
Fifth, high inventory will remain the norm in the market. As of July 3 1, the inventory of five kinds of steel products reached 22.29 million tons, an increase of 276,000 tons over the previous week, with an increase of 1.3%. An increase of 4.35 million tons or 24.2%. Zhang Qiusheng predicted that inventory is expected to enter a downward channel in the second half of the year, but under the influence of high supply, high inventory will still become the market norm.
Sixth, the cost of raw fuels such as iron ore has been strongly supported. Zhang Qiusheng believes that the supply of iron ore will change from tight to balanced in the second half of the year, and the price of iron ore is expected to fall at a high level. It is estimated that the transportation volume of the four major mines will reach 564 million tons in the second half of the year, an increase of 38 million tons over the first half. With the increase of shipment and arrival volume and the unloading of a large number of pressure vessels in the early stage, the growth rate of iron ore port inventory will accelerate and the pressure on iron ore supply will be alleviated.
As of July 3 1, the iron ore futures price reached 849.5 yuan/ton, and the spot price of iron ore reached11.4 USD/ton, both of which were at high levels in the year. Zhang Qiusheng said that since June, the National Development and Reform Commission, the Steel Association, the Chamber of Commerce and other departments have frequently voiced their voices, and the Ministry of Industry and Information Technology has recently requested that iron ore price speculation be treated both in symptoms and root causes. It can be seen that the willingness of the policy to suppress ore prices has been significantly strengthened, and the pressure on iron ore prices is greater.