Fully resumption of pipe production

For hot coil, the supply and demand pattern is relatively weak. Under the conversion of hot metal between steel varieties such as galvanized steel pipe, the output of hot coil continues to decline, and the latest weekly output decreases 46,400 tons on a month-on-month basis, which also shows the low supply pattern, giving steel price support. However, the demand performance of hot coil is still weak, the weekly meter needs to continue to reduce, and the inventory is ushered in the peak season. Most of the downstream production is restricted because of the dual-control policy of energy consumption, and the cold rolling output is low and the meter needs to decline. Pay attention to the downstream changes after the adjustment of the power limiting policy.

However, plate tariff adjustment is expected to remain unchanged, export demand concerns. Production decline shows the continuation of the low supply pattern of hot coil, giving price support, but the demand reduction of Cold Rolled Round Steel Pipe is also obvious, production constraints in downstream industries, superimposed export tariff adjustment risk, hot coil fundamentals are relatively weak, the subsequent trend will still follow building materials. It is worth noting that, different from the high material correction, the recent trend of iron ore prices is relatively strong, iron ore main futures intraday break 800 yuan/ton integer mark, low rebound nearly 200 yuan/ton, while the iron ore price index also rose from 94 dollars/ton to 136.95 dollars/ton, a cumulative increase of up to 45.7%.

On the one hand, the logic of China steel tube factory to resume production and the influence of the double control of energy consumption is weakening. And recently, the top management once again reiterated not to carry out “campaign” carbon reduction, and the market’s expectation on the relaxation of production restrictions is strengthened, which drives the ore price to bottom out and strengthen. At the same time, the latest sample steel mills’ daily output of molten iron and daily consumption of imported ore rose before the holiday, which is to verify the above expectations. On the other hand, after the holiday replenishment of carbon steel pipe is expected, steel mills to consume the ore in the plant, its inventory has been reduced to an extremely low level, the 247 steel mills of steel Union inventory is 101 million tons, down 2,724 million tons from the previous month, the lowest in the same period in recent years, a year-on-year decline of 7.75%. On the contrary, the daily consumption did rise, after the holiday steel replenishment bring ore demand improvement, it can track the high-frequency data of port transaction to verify.