Raw material analysis: China standing Committee said to continue to keep stable in the supply and price of bulk commodities, to maintain the basic stability of prices; The National Development and Reform Commission, the State Administration for Market Regulation and other departments to strengthen the supervision of iron ore;
At present, 12 departments have strengthened supervision over the iron ore market, in which stock has exceeded 160 million tons and to an all-time high level.
The price Department of the NDRC met with the top ten iron ore importers on 14th Feb., to ensure the stability of prices, meanwhile met with the China Port Association and the six major ports on 23rd Feb., research on improving port iron ore turnover efficiency, raising stockpiling cost appropriately, preventing iron ore hoarding and other related work.
Coke: The coke market was temporarily stable and strong on 23rd February. The price of coke increased by 200 RMB / ton in the first round. The start operating rate of coke enterprises is low, the stock is mostly reduced to a low level, and the deal is smooth. The current coke price has gradually stabilized, and the market's bullish sentiment has strengthened. After the Winter Olympics, the blast furnaces of steel mills have gradually resumed production. The coke stock of some small and medium-sized steel mills is slightly low, and the purchasing sentiment is positive. With the accelerated production resumption of downstream steel mills, the demand for coke has also increased significantly, and coke companies have a strong willingness to raise prices.
Hot-rolled coils: The overall steel price has shown a wide fluctuation adjustment trend recently, and the fluctuation range is 15-25 USD/ton. With the closing of the Olympic Games, downstream enterprises have gradually resumed production and their production capacity has gradually been released, but some steel mills still maintain stable production capacity. From the perspective of steel mills, there is a strong willingness to increase prices, and from the market side, the unstable transaction affected the increase of spot prices.
Futures market: With the conflict between Russia and Ukraine, U.S. stocks fell, the futures market fluctuated strongly, an excessive fall in steel stock prices, and the spot price also fluctuated weakly, and even the spot price began to decline.
Comprehensive analysis: There are two very certain factors in the current steel market in China, one is low output, it is expected to continue until the end of the heating season. The other is the low inventory, this low inventory will continue throughout the year 2022. At present, the rising and falling form two opposing forces. In the following days, we only have one focus, which is demand and transaction. In the short-term, bargain-hunting buying is the right choice as China drives demand for the base material.
