Rebar demand is off season

Production may increase
Last year’s crude steel output reduction was overachieved, falling by 3% from a record high, the first decline in six years, thanks to the Ministry of Industry and Information Technology’s pre-deployment and strong implementation. And a recent meeting of the Ministry of Industry and Information Technology did not mention this year’s crude steel production reduction work, sparking market doubts about this year’s production reduction policy easing. In addition, the recent limit production range did not significantly exceed market expectations. North China first quarter production limit actual implementation or reduced. In the high profit, after the heating season of non-limited production area of Chinese steel pipe company will resume production, when the output is expected to increase.

From the long process point of view, short process steel mill losses are serious, the holiday production. From the point of view of the long process end, with the end of the blast furnace overhaul, stacking steel winter storage orders increased significantly, driven by high profits, the pace of resumption of square steel pipe production accelerated. As of January 13, weekly thread production rebounded to 2,843,900 tons for three consecutive weeks.

Real estate policy support
Statistics from the National Bureau of Statistics show that the investment in real estate development nationwide reached 14.760.2 trillion-yuan last year, up 5.7% on average in two years. The floor area of newly started housing construction was 1,988.95 million square meters, down 11.4 percent from last year and 31.15 percent year-on-year. Real estate development enterprises purchased 215.9 million square meters of land, down 15.5 percent from last year. The sales area of commercial housing was 1,794.33 million square meters, up 1.9 percent from last year and down 15.64 percent year-on-year in the same month. New start data is a leading indicator of China hollow section demand, the new start area is difficult to recover effectively in the short term. Land transactions continue to be depressed, even if the recovery but transmission to new areas will take 3-6 months. In addition, last year in the first and second quarters of the new construction area base is high, this year’s new construction area year-on-year growth is not optimistic. On the whole, macro expectations are improving and real estate sales are picking up, but it still takes time for the transmission to the new construction sector, and the demand side has not been falsified.

There are signs of accumulation
As of January 13, five varieties of steel into the seasonal inventory stage, an increase of 21,500 tons. Among them, the factory warehouse inventory was 4,197,800 tons, down 65,600 tons from the previous month, the overall low; The social inventory was 10,575,300 tons, up 277,100 tons from the previous month, and the rhythm of stockpiling was stable. From the point of view of variety, only the spiral welded pipes showed a small sign of inventory, while the hot coil maintained a small inventory state for five consecutive weeks.