【 Macro News 】 The National Development and Reform Commission conducted research on the price index of steel, iron ore and other varieties; From January to October, the steel industry achieved a profit of 26.67 billion yuan; Cisa: After the implementation of the “cornerstone plan”, the iron concentrate production capacity has been started of about 50 million tons, and the scrap coordination mechanism is also being studied and formulated; Goldman Sachs: There is no oversupply risk of iron ore and a 3-month target price of $130 a tonne. Europe’s biggest steelmakers warn that deindustrialisation in Germany could intensify; Shen Bin of Shagang Group: The steel market next year, especially the market of high value-added varieties of steel, is full of expectations.
Steel scrap
Yesterday, the scrap market was stable and mixed, among which some steel mills in Jiangxi, Guangdong and Henan raised the purchase price of scrap steel, the increase was between 20-30 yuan/ton; Some steel mills in Jiangsu, Shanxi and Liaoning have reduced the purchase price of scrap steel, with a drop of 20-30 yuan/ton; Some steel mills in Hebei were mixed, the adjustment range was between 10-20 yuan/ton, and the scrap price in Chengdu was stable.
Last weekend, steel scrap stable in a narrow range of shocks, the poor performance of steel transactions, some steel companies pressure prices, scrap according to the futures trend adjustment, led to the weakening of scrap yesterday, the market is more cautious, the pace of shipment accelerated. At present, the price of raw materials is strongly supported, the iron ore has fallen slightly, the cost performance advantage of scrap steel is obvious, and the scrap price is supported as a whole, but the current mainstream steel mill has sufficient inventory, and the “winter storage” gap is limited. It is expected that the overall scrap steel is stable today, and the narrow oscillation is weak.
Spiral steel
Yesterday, the price of building materials such as thread fluctuated steadily, up and down, with the seasonal weakening of demand, the market initiative to take the enthusiasm of the goods is not high, the transaction is cautious, coupled with the obvious cooling in the north, the demand is released more pressure, steel price operation is more repeated, the overall trend is still rising, it is expected that the price of building materials is strong today.
Iron ore
Yesterday, the mainstream trading price of port mine fluctuated slightly, iron ore prices were mixed, the downstream steel mill profits were repeated, still negative, steel mills are not willing to accept high prices, on-demand procurement, liquidity has not improved, high iron ore just need to release more support, but the policy regulatory pressure above iron ore is large, the upward power is insufficient, but the willingness to actively reduce prices is not high, and the risk of falling back is aggravated. Iron ore prices are expected to be high and volatile today.
Macro view to hear
The National Development and Reform Commission conducted research on the price index of steel, iron ore and other varieties
In order to further understand the compilation and release of some commodity price indexes and serve the reasonable formation of market prices, the Price Department of the National Development and Reform Commission recently conducted research on the price indexes of steel, iron ore, lithium, palm oil and other commodities compiled and released by a number of institutions to understand the relevant price index compilation plans, data collection, calculation and release systems, etc. To study and promote the healthy and orderly development of the price index market.
The steel industry recorded a profit of 26.67 billion yuan from January to October
According to the data of the National Bureau of Statistics, from January to October 2023, the operating income of ferrous metal smelting and rolling processing industry was 688.78 billion yuan, down 3.7% year-on-year; Operating costs were 6,592.46 billion yuan, down 3.8% year-on-year; Total profit was 26.67 billion yuan, up 37 percent year on year.
Cisa: After the implementation of the “cornerstone plan”, the iron concentrate production capacity of about 50 million tons of scrap steel coordination mechanism is also being studied and formulated
According to China Iron and Steel News Network, China Iron and Steel Industry Association vice President Luo Tiejun said at the 2023 steel industry chain security conference, in order to enhance the steel industry resource security capabilities, the steel association research put forward the “cornerstone plan” proposal, at present, the domestic key iron ore projects have started more than 10, new iron concentrate capacity of about 50 million tons. At the same time, there are still some problems to be solved in China’s mineral resources security, such as insufficient domestic resource exploration, the approval of new iron ore projects is still difficult, the output of domestic scrap steel resources has not reached a high growth period, and the relevant policies for scrap recycling are still to be improved. Recently, the association has reported on scrap related issues to the relevant ministries and departments, and the scrap coordination mechanism is also being studied and formulated.
Goldman Sachs: There is no oversupply risk of iron ore with a 3-month target price of $130 a tonne
Goldman Sachs said in a note that the iron ore market is now set to balance by 2024, compared with previous expectations of oversupply, suggesting that there is no current risk of oversupply. Analysts, including Nicholas Snowdon, said steel mills were likely to restock ahead of the Lunar New Year holiday, with upside risks now outweighing downside risks due to low supply chain inventories. Goldman Sachs now has a three-month target price of $130 a tonne and a six-month target price of $120 a tonne.
Germany’s deindustrialisation could intensify, Europe’s biggest steelmakers have warned
A survey this year by the German Chambers of Commerce and Industry (DIHK) showed that 32% of German industrial companies surveyed now preferred to invest abroad rather than expand at home. That’s more than double the 16 percent who said in last year’s survey that they fear the loss of cheap energy in the future after a bad relationship with Russia. Gunnar Groebler, chief executive of Salzgitter, Germany’s second-largest steelmaker, called on Germany’s big energy users (manufacturers) to commit to using the country as a base to slow the growing deindustrialization process.
Shen Bin of Shagang Group: The steel market next year, especially the market of high value-added varieties of steel, is full of expectations
Shen Bin, Secretary of the Party Committee and chairman of Shagang Group, said recently that “adhere to the focus of economic development on the real economy” under the background, with the introduction of national fiscal, financial, consumption and other policies, the steel market next year, especially the high value-added varieties of steel market is full of expectations, and it is necessary to further practice internal skills. It is also necessary for the upstream and downstream industries of steel to further strengthen coordination and cooperation, work hard to strengthen the chain, and enhance the overall competitiveness of the industrial chain.
