Since the beginning of last week, due to the unexpected performance of the Sino-US economic and trade talks, the steel futures market has continued to rise, market confidence has increased, trading performance is acceptable, and quotations have accumulated.

According to the commodity market analysis system of Sino-US, the price of ordinary mild Steel plate (material: Q235B; specification: 20) was 3,392 RMB/ton on May 16, up 0.59% from the previous Monday.

1. Influencing factors

Steel billet market: Domestic steel billet prices rose last week and temporarily stabilized. As of May 16, the tax-inclusive price of Tangshan ordinary square billets was 2,980 RMB/ton, up 70 RMB/ton from the previous week. In terms of inventory, Tangshan's main warehouse inventory was 622,100 tons, down 62,800 tons from the previous week. In the first half of last week, due to the positive results of tariff negotiations, the ferrous metal market rose strongly, market sentiment improved, steel billet transactions were smooth, and steel billet manufacturers' quotations rose. After Thursday, the futures market fluctuated and weakened, and the quotation of steel billets was temporarily stable. It is expected that the domestic billet market will fluctuate and run weakly.

Supply and demand

From the perspective of social inventory, the cumulative inventory of rebar in major sample cities across the country is 4.3675 million tons, a weekly decrease of 305,300 tons; the cumulative inventory of wire rod is 649,800 tons, an increase of 11,400 tons from the previous week; the cumulative inventory of the five major steel varieties is 10.0114 million tons, a weekly decrease of 383,700 tons.

2. Analysis and forecast

On the whole, in mid-May, the vast southern region has increased rainfall, and some outdoor construction has been affected. Fortunately, social inventory is low and merchants have limited sales pressure. At the same time, a few steel companies have arranged maintenance, and the output of molten iron has fallen from a high level, and the supply has decreased in the later period. Considering that there is no positive stimulus in the short term, the supply and demand pattern is expected to weaken, the cost support is weakened, and the market operation is still cautious. It is expected that the domestic medium and thick plate market will be weak in the short term.

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