Steel prices have rebounded recently, but the height is limited

"Since the beginning of April, domestic steel prices have gradually recovered after experiencing a sharp decline in the early stage." On April 19, Li Zhongshuang, general manager of Shanghai Ruikun Metal Materials Co., Ltd., said in an interview with a reporter from China Metallurgical News that in April, The domestic steel market has picked up, and the prices of mainstream steel products have begun to stop falling and rebound.

Li Zhongshuang predicts that steel prices will continue to fluctuate and rebound in the short term, but the height of the rebound will be limited. According to statistics, in early April, the price of hot coil Q235B in the Shanghai market increased by 40 yuan/ton, the price of hot coil SPHC increased by 30 yuan/ton, and the price of cold-rolled coil increased by 10 yuan/ton, showing an overall rebound trend.

"One of the reasons for the rebound in steel prices during this period is the gradual release of demand." Li Zhongshuang analyzed. Currently, all parts of the country are increasing infrastructure construction. According to incomplete statistics, in March, a total of 7,884 major projects were started across the country, with a total investment of approximately 3.974956 billion yuan, and the total investment in the first three months of this year was approximately 14.85 trillion yuan. “New construction projects in various places are ushering in a construction climax, which will stimulate the release of ‘steel demand’ and help promote the stabilization and recovery of steel prices.” He said.

At the same time, steel mill inventories and social inventories have recently declined. As of April 14, among the steel inventories in 29 key cities across the country, the social inventory of wire rods and coiled snails was 1.1105 million tons, a decrease of 7.90% from the previous week, a decrease of 23.89% from the same period last month, and a decrease of 34.77% from the same period last year; thread Steel social inventories were 7.6661 million tons, a decrease of 5.11% week-on-week, a decrease of 17.50% compared with the same period last month, and a decrease of 1.17% compared with the same period last year. In terms of steel plant inventory, at the end of the first ten days of April, according to statistics, the steel inventory of key steel companies was approximately 18.2538 million tons, a decrease of 173,600 tons or 0.94% month-on-month.

On the supply side, steel companies have recently taken the initiative to control production, and output has dropped significantly. According to data from the China Iron and Steel Industry Association, in the first ten days of April, the average daily crude steel output of key steel companies was 2.1118 million tons, a decrease of 0.47% month-on-month. "It can be seen that the current steel production and inventory have both declined, and the contradiction between market supply and demand has eased, thus helping steel prices stop falling and rebound." Li Zhongshuang predicted.

On the demand side, the production and sales situation of the manufacturing industry has improved recently, and the demand for steel has increased. In terms of automobiles, data show that in March, my country's automobile production and sales reached 2.687 million and 2.694 million units respectively, a month-on-month increase of 78.4% and 70.2% respectively, and a year-on-year increase of 4% and 9.9% respectively. In terms of ships, judging from the global new ship orders in the first quarter of this year, my country's shipbuilding industry has maintained a large lead, and the number of new ship orders has increased significantly. Analysts from the China Shipbuilding Industry Association believe that at present, domestic mainstream shipyard orders are basically scheduled until 2027 and 2028. Shipowners are ordering a large number of dual-fuel ships that meet green and environmental protection requirements to promote the growth of ship demand. It is expected that the demand for ship steel will increase in the future. It will continue to maintain steady growth in 3 to 4 years, with annual steel consumption ranging from 13.5 million tons to 14.5 million tons.