Fundamentals: a sharp increase in inventory of 420000 tons reflects the accelerated fall in demand
1. Inventory increased by 420000 tons
On Friday, the inventory data of major categories increased by 415700 tons, while the output slightly decreased by 4400 tons. In terms of varieties, the increase of screw steel storage is obvious, especially in the context of the production decline of 90000 tons, the total increase of 235500 tons in the factory, warehouse, society and warehouse, reflecting the gradual decline in demand. In terms of plates, small stock accumulation, hot rolling stock increased by 54400 tons, cold rolling stock increased by 5400 tons, medium and thick plate stock increased by 47900 tons. Overall, the stock accumulation of building materials accelerated, the stock of plates increased slightly, the downward trend of demand increased, the steel price will continue to bear downward pressure, and the decline of building materials will be greater than that of plates.
2. Coke rises and lands in the third round, and the raw material end is in strong operation
Affected by the reduction of coking production capacity and the suspension and shutdown of illegal projects, the supply of coke has declined and two rounds of price hikes have been carried out. However, with the recent upgrading of environmental protection and production restriction, the market supply continues to shrink due to the production restriction of coke enterprises, and the third round of price hike is gradually implemented. It is understood that the steel mills in Handan and Tangshan areas of Hebei first agreed to increase the price in this round, most of which were implemented on December 26, and some steel mills in Shandong also increased the purchase price of coke by 50 yuan / ton from 0:00 on December 26.
3. The Ministry of ecological environment increases the monitoring and management of emissions of iron and steel enterprises
The Ministry of ecological environment recently issued the notice on the assessment and monitoring of ultra-low emission of iron and steel enterprises, which requires iron and steel enterprises to complete the transformation of ultra-low emission and operate continuously and stably for one month, and then they can independently or entrust qualified monitoring institutions and competent technical institutions to conduct organized emission and unorganized emission according to the technical guidelines for assessment and monitoring of ultra-low emission of iron and steel enterprises Carry out evaluation and monitoring on the transportation of bulk materials and products. In addition, the joint punishment should be strengthened for the steel enterprises and relevant assessment and monitoring institutions that commit fraud.
This also means that the environmental protection requirements of the steel industry will be more and more strict, and the environmental protection cost of the industry will further increase, which will also increase the pace of survival of the fittest, and the elimination of backward production capacity in 2020 will continue to increase.
4. Macro focus:
① Many places have determined the new scale of special bonds in January: by December 25, Shanxi Province, Sichuan Province, Zhejiang Province, Hunan Province and Qingdao City have disclosed the information of local bond issuance in 2020, and a total of 170.63 billion yuan of new special bonds will be issued in January next year. It will help infrastructure investment continue to make efforts in the first quarter of next year, which will help steel demand pick up after the Spring Festival.
② The epectation of reducing the standard is strengthened: near the end of the year, the fund is usually tight, but in the context of suspending reverse repo for the third consecutive day, the overnight interbank offered rate continued to decline. On December 26, most shibors fell, and the overnight varieties fell 9.5bp to 0.848%, a new low since July 4. The Bank of China's overnight repo weighted average interest rate fell more than nine basis points, the lowest intraday level since 2009. Reflecting that the current fund is relatively loose, which is also interpreted by industry figures as that the expectation of reducing the standard is increased, and the effect appears in advance. As for the market speculation this evening will release the news, we will wait and see!
The market sentiment of galvanized steel sheet is short, the transaction continues to shrink, and the steel price is declining
Near the Spring Festival, this week's inventory data increased significantly, reflecting the accelerated decline in current demand. From the perspective of this year's winter storage market, the enthusiasm of traders is generally low. On the one hand, this year's steel winter storage policy is relatively strong, and the settlement price is generally higher than that of the same period last year. On the other hand, most merchants are affected by last year's losses. In the context of the general decline of industry profits this year, the willingness of winter storage is not high.
At present, the market sentiment of galvanized steel sheet is short, the transaction continues to shrink, the steel price downward trend, and the high price regional decline is more obvious.