Price trend

According to the Commodity Market Analysis System of SunSirs, the price of iron ore rose first and then fell last week (7.5-7.13, the same below), with a narrow range of fluctuations. As of the 13th, the SunSirs Iron Ore Price Index was 762.89 points, up 3.47% month on month, as shown in the above chart. Last week, the price of iron ore slightly increased and was trending towards strength. The main reason for this was that the market's "anti involution" sentiment was fermenting, which was driving up the demand for iron ore speculation. In addition, the impact of the dual focus news and changes in production costs were favorable for the industry market, which can drive the price of iron ore to rise; In terms of supply and demand, due to the downward shift in raw material costs, steel mills had good profits, and the active operation of steel mills provided support for iron mines, resulting in insufficient downward momentum for the daily production of molten iron. However, due to a significant drop in overseas shipments and a decrease in port inventories, iron ore prices had slightly increased and were trending towards strength last week.

Analysis review

In terms of inventory, as of July 11th, the imported iron ore inventory in 45 ports across the country was 137.6589 million tons, a decrease of 1.1251 million tons compared to the previous month; The daily average port clearance volume was 3.1951 million tons, with an increase of 0.22 million tons compared to the surrounding area; There were 103 ships in the port, with an increase of 11 ships in the surrounding area. The inventory situation of iron ore ports last week was shown in the above figure; The total inventory of imported iron ore by steel mills nationwide was 89.7964 million tons, an increase of 61.07 tons compared to the previous week. This week, the profit situation of steel mills was good, and the demand for replenishment procurement was maintained, so the port clearance volume stopped decreasing. Last week, the steel mills had good profits and a positive willingness to start production. The daily port clearance volume was maintained. Although overseas shipments had been reduced, the number of ships arriving at the port last week had increased. In addition, some steel mills had equipment maintenance plans, and there may be accumulated inventory at the port next week. It still need to pay more attention to the changes in port iron ore inventory next week.

In terms of supply, as of July 7th, the total global shipment of iron ore last week was 29.949 million tons, a decrease of 3.627 million tons compared to the previous week; The total shipment of iron ore from Australia and Brazil was 24.65 million tons, a decrease of 4.173 million tons compared to the previous period. The shipping volume from Australia was 18.026 million tons, a decrease of 1.964 million tons compared to the previous period, of which 14.537 million tons were sent from Australia to China, a decrease of 3.231 million tons compared to the previous period. Brazil's shipping volume was 6.624 million tons, a decrease of 2.209 million tons compared to the previous period. Last week, shipments from Australia and Brazil have significantly decreased. The overseas shipping volume of Australia and Brazil is subject to cyclical changes, mainly influenced by seasons and weather conditions. Short term shipping may vary, but in the medium to long term, the loose supply pattern of iron ore remains unchanged. The shipping volume of iron ore will continue to decline next week, and it is expected that the supply of iron ore will continue to decrease next week.

In terms of demand, as of July 11th, the operating rate of steel mills' blast furnaces was 83.15%, a decrease of 0.31% compared to the previous week; The utilization rate of blast furnace ironmaking capacity was 89.9%, and the circumferential ratio has decreased by 0.39%; The profit margin of the steel mill was 59.74%, an increase of 0.43% compared to the previous period; The daily average production of molten iron was 2.3981 million tons, a decrease of 10,400 tons compared to the previous period; The daily consumption of imported ore by sample steel mills was 2.9849 million tons, a decrease of 23,200 tons compared to the previous period. Last week, the steel mills continued to operate at a high level, and the decrease in production costs maintained good profits for the steel mills. However, the situation of limited terminal production became increasingly serious. Nevertheless, manufacturers were actively starting production and were mostly conducting equipment maintenance. It is expected that the demand for iron ore will be slightly reduced next week.

In terms of scrap steel, the price of scrap steel fluctuated upward last week, with a focus on strengthening operations. Last week, the main trend in scrap steel prices was strengthening. As of July 11th, the profit situation of steel mills was good, and the enthusiasm for starting production was good. Influenced by the overall upward trend of the black series market, scrap steel prices had also risen in some areas, and coke prices had fallen multiple times, which was favorable for scrap steel demand. Scrap steel prices had been adjusted in some areas, and it is expected that the scrap steel market will continue to stabilize next week.

Future outlook:

In summary, the data analyst from SunSirs believes that on the demand side, the profit status of steel mills was good, and the willingness of steel mills to start production was positive. However, due to the terminal production situation, the overall demand situation is expected to decrease; On the supply side, there have been cyclical changes in overseas shipments this week, with a slight decrease in port inventory. Next week, overseas shipments will be reduced, and overall supply will fall. The supply and demand fundamentals of iron ore may continue to maintain a situation of supply and demand reduction. As of July 11th, the weather was gradually rising, and terminal production was severely restricted. Last week, the iron ore industry rebounded slightly, mainly driven by macro and news sentiment. There is a possibility of accumulated inventory in the iron ore port next week, coupled with negative fundamentals for iron ore. It is expected that iron ore will rise first and then fall, weaken and fluctuate next week. In the later stage, attention should be paid to the profit situation of steel mills and the actual demand of downstream finished products.

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