Price trend

According to the price monitoring of SunSirs, the prices of rebar and wire rod in Jiangsu, Zhejiang, and Shanghai regions fluctuated narrowly last week. As of the 11th, the average price of HRB400 rebar in the Jiangsu, Zhejiang and Shanghai region was about 3,164.5 RMB/ton, with a weekly increase of 1.65%; The average price of HPB300 high line was 3,355 RMB/ton, with a weekly increase of 1.28%.

Analysis review

In terms of the market: Last week, influenced by the "anti involution" policy, market sentiment improved, coupled with the rise in raw material prices, the support of the raw material side had moved up, and the market's willingness to pull up prices was high. Various markets raised prices, but overall demand in the terminal market had not improved. Therefore, the price of rebar and wire rod fell first and then rose last week, becoming stronger and oscillating.

The supply side produced 2.2269 million tons of building materials this week, with a month on month increase of 0.41%, indicating an increase in production. In terms of rebar, the production of rebar decreased by 44,200 tons. From a regional perspective, Southwest and East China saw a higher decrease, while Central and South China have shown a slight increase. Looking at provinces, Guizhou, Sichuan, Jiangxi, and Anhui have significantly reduced their production, mainly due to some steel mills transferring their molten iron to other varieties and some steel mills shutting down for maintenance; Due to production adjustments of certain steel mills, the output of rebar in Hubei increased; In terms of production, this week's production continued to decline slightly, with a total decrease of 22,700 tons. From a regional perspective, the reduction was mainly concentrated in the southwest and central regions, with supply decreasing by 10,200 and 7,500 tons respectively. At the same time, there was a slight increase in the northwest region, with supply increasing by 9,000 tons. Production in other regions had also decreased to varying degrees; Looking at each province, Sichuan Province experienced a significant decline, with a decrease of 9,200 tons in weekly production, while other regions had mainly experienced slight fluctuations in production.

In terms of inventory, the national building materials inventory last week was 4.1944 million tons, an increase of 0.098% compared to the previous week. Last week, the factory's inventory showed an increasing trend, with a month on month increase of 0.41 million tons. Among them, inventory in Northeast, North, Southwest, and Northwest increased slightly, while inventory in East, Central South, and South China decreased slightly. By province, Henan and Jiangsu experienced the highest inventory decline; In terms of reel production, the factory's inventory increased from a decrease last week, with a total increase of 2,000 tons. From a regional perspective, the inventory growth in the North China region was among the highest, with an increase of 12,300 tons, while steel mills in other regions experienced slight fluctuations in inventory to varying degrees; Looking at each province, Shanxi's inventory growth rate ranks among the top, with a weekly increase of 13,800 tons. The East China region reduced inventory by 61,600 tons, while the South and North regions had accumulated inventory of 8,600 tons and 0.06 million tons respectively; From the perspective of the seven major regions, except for North China and China, all other regions were in a state of destocking. In terms of hot coils, from the perspective of the three major regions, the northern periphery had a storage capacity of 16,100 tons, while the eastern and southern regions accumulated 18,400 tons and 9,000 tons respectively; From the perspective of the seven major regions, except for South China, North China, and Northwest China, all other regions were in a state of accumulated inventory.

On the demand side, the average weekly trading volume in China last week was 99,280 tons, a decrease of 0.752 compared to the previous week. The trading volume decreased, falling below 100,000 tons. Although downstream terminal demand was still being released, there is a trend of reduction, mainly due to the gradually warming weather at this stage, which limited downstream terminal production and was not conducive to the release of steel demand.

Market outlook

In summary, analysts from SunSirs believe that the gradual increase in temperature at this stage led to weak release of terminal demand; On the other hand, in terms of steel mills, the upward trend in steel prices was favorable for the recovery of production profits, and the production situation of steel mills had improved. The supply and demand of thread rebar and wire rod may shift towards a trend of increasing supply and decreasing demand, and the process of destocking from social inventory was limited. As of July 11th, market sentiment was dominant in price trends, and it is expected that prices will rise first and then fall next week, with a narrow range of fluctuations.

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