Price trend

The price of hot rolled coils has slightly increased this week. According to the Commodity Market Analysis System of SunSirs, as of July 11th, the average price of hot rolled coils in the domestic market is 3,326.67 RMB/ton, with a weekly increase of 3.74%; The average price of Cold Rolled sheet in the domestic market is 3,707.5 RMB/ton, with a weekly increase of 0.815%.

Factors affecting price fluctuations:

Fundamentals

According to the latest data obtained from SunSirs, the social inventory of hot rolled steel this week is 2.6775 million tons, an increase of 41,000 tons on a weekly basis, a weekly output of 3.2314 million tons, and a decrease of 23,100 tons on a weekly basis; This week, the social inventory of Cold Rolled products is 1.3104 million tons, with a weekly increase of 0.13 million tons and a weekly output of 882,300 tons, with a weekly decrease of 0.12 million tons.

As of July 8th, the number of steel billet orders held by steel mills in the sample was 1.507 million tons, a decrease of 288,000 tons or 16% compared to June 20th. This week, the inventory of steel billets of the same caliber in Tangshan's main warehouses and ports is 1.0537 million tons, an increase of 109,400 tons compared to the previous week. During the research period, downstream demand remained low and inventory continued to accumulate; In terms of ports, export resources are gathered at the port.

Cost side

On the supply side, this Friday's supply of major steel varieties is 872.72 tons, a decrease of 124,400 tons or 1.4% compared to the previous week. This Friday, the production of major steel varieties increases compared to the previous week, except for medium and thick plates. The core driving force is that some steel mills have stopped production for maintenance and the variety of molten iron in steel mills has been transferred. In terms of inventory, the total inventory of large steel products this Friday is 13.3958 million tons, a decrease of 0.35 million tons or 0.03% compared to the previous week. This Friday, the overall inventory ratio of major varieties decreases slightly, while the factory inventory ratio increases, mainly due to the contribution of medium and thick plates. The weekly ratio of social inventory has decreased, mainly due to the contribution of rebar. In terms of consumption, the weekly consumption of major varieties this Friday is 8.7307 million tons, a decrease of 1.4%; Among them, the consumption of building materials decreased by 2% month on month, while the consumption of board materials increased by 1.8% month on month. This Friday, the apparent consumption of major varieties shows a decrease in building materials and an increase in board materials, reflecting the seasonal impact of the off-season.

Future outlook:

Overall, in terms of supply, due to the recent increase in steel mill maintenance plans, the production of molten iron has fallen, and the subsequent production of finished products may follow suit. However, due to the current profitability of steel mills, the rate of production decline may be relatively slow. In terms of demand, the accumulation rate of steel inventory during the off-season is slower than in previous years, and the inventory pressure of steel mills is still acceptable, resulting in limited overall supply and demand contradictions. In terms of cost, steel mills have a high enthusiasm for replenishing coke raw materials, and the current market expects coke to start its first round of price increases, with support from steel costs. The market sentiment has been boosted by news such as the "anti involution" movement, and overall it is warm. Overall, the fundamental contradictions in steel are not yet prominent. Driven by cost support and market sentiment, it is expected that steel prices will fluctuate to be stronger in the short term.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.