The reasons of instability of steel prices

According to a recent market, the domestic steel market seems to have stabilized obvious signs of stabilization, the futures market has significantly improved, and the main reason is the estimated manufacturing PMI rebounded slightly, since the market bottomed steel plate two days phenomenon particularly evident. But even so, the downstream demand procurement still showed no obvious change, supply and demand pressures did not alleviate the Steel City, Steel City twist condition is not strong, so businesses are not optimistic attitude.

Steel market has been the downstream demand is flat light, season so, not to mention soon to enter the off-season. So, steel prices have been weaker, until recent date steel higher price very obvious mainstream city, the surrounding cities to follow suit to pull up, the market volume have rebounded, but this is only short-term stimulus act, end demand does not appear substantially upgraded .

In addition there was no substantial change for the better demand than the supply pressure, the Steel City is also no signs of improvement. Steel production enthusiasm is still high, from mid-May crude steel production statistics, the national average daily production of 2,185,400 tons of crude steel, the chain fell 0.35 percent in early May, but still living in historic times high. The May PMI index also showed iron steel industry production index for the month was 49.0 percent, up 4.1 percentage points rise. New orders index rebounded, which makes steel production activities are very active.

In addition, there is a very important factor, that is, raw materials market continued to decline. It is understood that this year, the iron ore market has been in a downward trend, steel procurement initiative suffered a heavy blow, there are also many mills intent to purchase select the sidelines, a further blow to market confidence. Platts index, the S & P futures rose 0.75 yesterday, is now 62% of Australian fine exponent $ 116.75 / ton. Tender price surge in imported ore mines significantly boost market confidence, so long since considered the iron ore market finally has a slight color, the market is bullish atmosphere is also strong, but now the price is still at a relatively low level, while the cost respects with the trend of steel prices have great relevance, raw material prices go up, which seriously hampered the cost steel prices upward, so as long as the market is still so raw materials decline, and that business confidence in the latter part of the Steel City will be significantly inadequate.

Generally speaking, the steel prices is affected by several different factors, as long as analytic the demand of all kinds of demand, we can make the wise decision about the future steel prices trend. In order to get latest prices of steel, like angle iron, hot rolled coil, galvanized steel, steel plate, H Beam, steel sheet, it is necessary for us to make a deep survey in China steel market.

Latest China of steel prices trend

May the domestic construction steel prices market shocks, slightly down trend, domestic building materials prices rose and then fell, although some businesses eager to pull up, but the actual volume does not follow suit, there is no significant change in the overall market price. Due to the recent arrival of small local markets, the declining trend in the overall stock market. From key markets in Beijing, Shanghai and other places to price movements, basically are in a slight concussion running in the market, no significant increase in purchases in the case, the market is difficult to have better opportunities.

From the overall market trend, the domestic construction steel market in May than in April a slight decline. As of May 27, the domestic 25mm rebar price in 3555 yuan / ton, late last month down 56 yuan / ton; including Beijing 25mm price of 3520 yuan / ton, late last month fell 10 yuan / ton; Shanghai 18 - 25mm price of 3380 yuan / ton, late last month fell 100 yuan / ton; Guangzhou 18-25mm price of 3670 yuan / ton, late last month rose 20 yuan / ton; domestic 6.5mm high speed wire price in 3608 yuan / ton, late last month fell 37 yuan / ton, Beijing 6.5mm high speed wire prices in 3540 yuan / ton, unchanged from last month, Shanghai 6.5mm high speed wire price is 3390 yuan / ton, late last month fell 30 yuan / ton, Guangzhou price 3700 yuan / ton, late last month fell 10 yuan / ton.

According to the China Iron and Steel Industry Association, the latest data show that its member companies in early May crude steel output to 1.748 million tons, an increase of 2.71% mid-chain, the national estimate is 2,192,900 tons, an increase of 3.02% mid-chain. National crude steel output hit a late degrees with high caliber and less Bureau of Statistics announced in April the national crude steel output (2.188 million tons) high 05,000 tons, or 0.23 percent. In early May the national crude steel output rose a new direction since the second quarter of blast furnace production gradually into a relationship on track, but also with steel mills to increase production costs for the dilution of efforts related. In the absence of significant positive macro-policy side and demand-side effects of the rainy season by Southern backdrop, the high crude steel output will continue to put pressure on the market.

With the advent of June, most of the country all will enter the hot and rainy season, outdoor construction progress of the project will be greatly hindered, the steel city will officially usher in the season, coupled with the originally scheduled to be held in March about working conference on cities and towns because the reasons for planning a push again, the terminal needs significant volume expectations are not high, the market mentality and many more cautious bearish based, and although the national building social stock consecutive ten weeks continued to decline, but still compared to the same requirements relatively high, it is expected that the market "to the inventory, lower risk," will remain a major operation, building materials prices will continue to run in the bottom of the stage.

In summary, due to the recent bad policy side still prevail, and the market supply and demand is still there, the cost of late also continue to support efforts to weaken possible, coupled with volatile international economic situation, the risk of financial market volatility is still large , is expected in June domestic construction steel market prices will remain within a narrow range downward trend run, like Galvanized steel, galvalume steel, ERW Pipe, Galvanized angle iron, Prepainted Steel, etc, will keep stable stake.