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Steel rebar period is now rising "silver ten" market cash?

Although Kim Gu's color is not enough, rebar futures and spot prices are sluggish. However, after entering the "Silver Ten", the prices of screw steel futures and spot have risen to varying degrees. Especially the price of screw steel futures has risen 173 yuan per ton since the end of September, and the spot price of screw steel has also risen 73 yuan per ton since the end of September. "Silver ten" market will be cash? Langer experts said that the current steel market upward trend is not obvious, the latter half of October steel market will continue to maintain a strong trend of volatility.

After the "eleven" golden week, all localities introduced policies on environmental protection and production restriction. Following the announcement of ultra-low emission standard policies by Hebei and Shandong provinces, the governments of the Yangtze River Delta, Linfen, Handan, Tangshan, Changsha, Fujian and Anhui provinces have successively promulgated relevant production-limiting policies for the heating season. In addition to the "2 + 26" cities around Beijing, Tianjin and Hebei, this year's production limits have been extended to the Yangtze River Delta, Fujian and other places. Although this year's environmental production restriction abolished the unified ratio of production restriction and shutdown, according to local conditions of air quality, formulated staggered peak production time, strictly prohibited to adopt a "one-size-fits-all" approach, but the scope of production restriction has been expanded. In September, with the continuous promotion of environmental protection and production restriction, the steel enterprise's starting rate further dropped, and the daily output of crude steel may decline to a certain extent, which is bound to ease the supply pressure.

On the cost side, the 62% import index was $71.71 per ton as of Friday, up $2.2 per ton from the pre-holiday price index. At the same time, driven by the recent rise in the prices of profiles, billets and iron ore, scrap prices have also risen. As of October 16, 2018, scrap prices were 2,480 yuan per ton, up 60 yuan per ton from late September, according to monitoring data from Langer Steel Cloud Platform. The rising prices of iron ore and scrap will form a certain support for the price of rebar.

In October, domestic steel social inventories rebounded slightly. According to the monitoring data of Lange Steel Cloud Merchant Platform, as of October 12, the social stock of steel in 29 key cities in China was 9.207 million tons, up 564,000 tons from the end of September and 385,000 tons from the same period last year. Despite a rebound in inventories, the overall inventory is still modest, down 47.8% from its peak in March. Therefore, inventory will not affect market confidence.

In addition, in order to safeguard domestic economic stability, the central bank recently lowered its level and released liquidity, which is the fourth time the central bank has lowered its level this year. It not only reduces the negative impact on the international side, but also produces the expectation of continued loosening of the capital side, which helps to boost market sentiment.

Ma Li, chief analyst of Langer Steel Network, said that the domestic steel market as a whole maintains a good operating situation, the market mentality is relatively stable, and the supply and demand are basically balanced. But the upward trend is not obvious, and the latter market is still maintaining a strong trend of volatility. Later, we should pay attention to the specific content of environmental protection and production restriction policies, or whether there are sudden production restrictions. In addition, we need to pay attention to the economic data of the first three quarters, and whether the relevant macro and monetary policies of the state will be greatly adjusted after the data are published. (source: Lange steel)
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