The shortage of supply led to a sharp increase in profit per ton of steel. The market buys up and doesn't buy down, and some downstream customers panic to replenish goods. The large-scale price increase of domestic steel mills also reflects the recovery of domestic production and the expansion of steel production demand. The domestic epidemic situation has been basically controlled, the production capacity of various enterprises has increased, and the demand for steel has increased, which has aggravated the contradiction between domestic steel supply and demand. Affected by carbon neutrality and carbon peaking policies, domestic steel prices have continued to soar this year. Companies such as Jiangsu Xugang Jiangang, Shanxi Jinnan Jiangang, Shanxi Zhongyang Jiangang and Shougang Changzhi Steel Plant Jiangang released price adjustment information.
With the gradual economic recovery and US President Biden vigorously promoting the infrastructure construction plan, it is expected that the demand for steel in the United States will increase substantially. Scarcity and panic are pushing up steel prices and inventories. Steel prices have risen sharply, and downstream enterprises are under greater pressure. The already weak profit margin is further overstocked. Downstream processing and manufacturing industries are waiting for the steel market to cool down in industrial pains. The steel market resources are still in short supply, and the phenomenon of rising prices and grabbing goods in the market is frequent. Iron ore and coke related varieties are relatively strong, and scrap steel is also relatively cost-effective, which has a certain supporting role for scrap steel. The short-term waste market is still likely to rise.
Due to the substantial increase of electric furnace steel output, the overall gap between supply and demand of crude steel is still difficult to make up, and the ability of electric furnace to adjust the balance between supply and demand of crude steel is weakened. It is difficult to change the situation of limited normal output and water regulation of other varieties of threads in a short time, and the situation of slow recovery of long-flow thread production is expected to continue. In order to effectively control the spread of the epidemic, traffic supervision has been strengthened in various places, and some areas have also taken measures such as closing cities and roads. Some transportation enterprises failed to resume work as scheduled, which had a great impact on raw material import and steel export. Logistics nodes such as ports, docks and warehouses also encounter problems such as limited operation, shortage of personnel and epidemic prevention materials, which seriously affect the normal transportation of steel and raw materials.