新闻资讯
新闻资讯

Iron ore plummeted by 8%, and rebar and hot-rolled coils couldn't hold up either. Is the downward trend in steel prices set for September?

Time

2021-09-08 15:02

Source:

On September 1, iron ore futures prices plummeted nearly 8%, closing at 763 yuan/ton. Steel futures prices continued to decline by 2%, with rebar dropping to 5242 points and hot-rolled coil falling to 5492 points. Throughout the day, prices fluctuated at low levels, consistently operating around the 5200 yuan and 5400 yuan range, temporarily breaking below the 60-day moving average, while coking coal and coke managed to recover, closing above the 2500 yuan and 3100 yuan marks respectively.
　　

 

 

On the 1st, domestic steel market prices were stable but slightly weak, with the price of common square billets in Tangshan dropping by 20 yuan/ton to 5000 yuan/ton. Measures like production limits and shutdowns were ineffective, and steel prices continued to weaken, with futures experiencing significant declines. On the first day of September, major steel mills remained firm in their pricing. In the morning, futures fluctuated widely, while spot prices generally fell, with end customers adopting a wait-and-see approach, and spot traders lowering prices to sell; in the afternoon, futures fluctuated and closed in the green, with spot prices remaining stable, and end customers mostly purchasing low-priced resources as needed, with spot traders selling at market prices, and some actual orders being negotiable, leading to a noticeable improvement in market transactions.

 

On September 1, domestic construction steel prices were stable but slightly weak; among them, Hangzhou Zhongtian reported 5180 yuan/ton, down 40 yuan/ton; Beijing Hebei Steel reported 5090 yuan/ton, down 30 yuan/ton; Guangzhou Guangsteel reported 5450 yuan/ton, down 20 yuan/ton. Domestic hot-rolled coil prices fell by 10-50 yuan/ton; among them, Shanghai Baosteel reported 5680 yuan/ton, down 20 yuan/ton; Tangshan Anfeng reported 5680 yuan/ton, down 40 yuan/ton; Foshan Liugang reported 5570 yuan/ton, down 10 yuan/ton. Domestic medium and heavy plate prices were stable but slightly weak; among them, Jiangyin Hengrun reported 5560 yuan/ton, stable. Domestic cold-rolled coil prices were stable but slightly weak, with Shanghai Baosteel reporting 6390 yuan/ton, stable.

 

According to monitoring data from Lange Steel, the average price of Ф25mm grade three rebar in key domestic cities is 5218 yuan/ton, down 19 yuan; the average price of Ф6.5mm high wire in key domestic cities is 5761 yuan, down 15 yuan; the average price of 5.5mm hot-rolled coil in key domestic cities is 5679 yuan, down 29 yuan; the average price of 1.0mm cold plate in key central cities is 6477 yuan, down 21 yuan; the average price of 20mm medium plate in key domestic cities is 5629 yuan, down 9 yuan.

 

In terms of news, China's manufacturing PMI for August is 50.1, expected 50.2, previous value 50.4. China's non-manufacturing PMI for August is 47.5, previous value 53.3. Analysts generally believe that as the impact of the pandemic gradually fades, coupled with the peak construction season in September and the upcoming "Double Festival" consumption peak, the manufacturing and service sector PMIs may soon see a rebound. Future policies need to strengthen efforts to expand domestic demand and consolidate the foundation for economic recovery.

The State Council has decided to carry out the eighth major inspection. After careful preparation, 16 inspection teams set off on August 31 to conduct field inspections in Beijing and 16 other provinces (regions, cities) for about 10 days. In the northeast region, production limits have been implemented, and currently, 9 steel mills (7 in Liaoning, 1 in Jilin, 1 in Heilongjiang) have stated that they have received notifications from relevant departments that "this year's crude steel output will not exceed last year's." According to research, the sample steel mills that received production limit notifications expect to reduce steel production by a total of 3.08 million tons from September to December, while the sample steel mills that did not receive relevant limit notifications are expected to be affected by 165,000 tons, bringing the total expected impact to about 3.245 million tons.

 

Currently, the work to reduce crude steel production is still ongoing, and as the traditional demand peak season approaches, the supply-side reduction is further showing its impact on prices. However, based on the economic data released in July, the actual demand for steel downstream remains to be observed.

 

Recently, the steel market is in a situation of weak supply and demand, with a slight month-on-month increase in rebar production, while hot-rolled coil production continues to decline. Steel demand has increased month-on-month, but remains at historically low levels year-on-year. Steel inventory continues to decline, but the pace of destocking is not high. It is expected that in the short term, steel demand will increase month-on-month, but overall demand is weak in the medium to long term, and domestic steel prices will fluctuate and adjust.

Source:Intercontinental Casting

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