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Home > News > Steel prices continue to decline, the market bearish sentiment is still heavier.
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Steel prices continue to decline, the market bearish sentiment is still heavier.

On November 20, the threaded steel futures opened low, with the lowest price in the main 1901 contract session reaching 3735 yuan/ton, a new low since July 20, closing at 3742 yuan/ton, down 110 yuan or 2.86%, and the monthly cumulative decline of the contract was more than 9%.

Steel prices have been falling recently. According to data from Jin Lianchang, the price weakness of the national construction steel market intensified last week. Futures continue to go down, the spot market atmosphere is pessimistic, the transaction is obviously deserted. Although there are still environmental production restrictions and inventories continue to decline, the demand side is gradually shrinking, businesses are panicked about the late trend, and some of the non-inventory pressure businessmen are singing out, in order to buy at a low level, leading to a sharp drop in market prices.

Based on this, Jin Lian recently launched a mental attitude survey on the steel price trend this week. The results are as follows: only 19% of people hold a bullish view on the price of this week, which is 2 percentage points higher than last week's bullish share; 33% are bullish, 6 percentage points higher than the previous period; 48% are bearish, 8 percentage points lower than the previous period. Overall, the recent price decline is larger, and the proportion of continued bearish declines slightly, but the overall bearish proportion is still larger.

From the basic point of view, Jinlianchuang Iron and Steel analyst Zhang Jinping said that as of November 15, according to incomplete statistics, there were 10 production line overhaul plans this week, involving 8 steel factories and more than 14 production lines, which are expected to affect the output of finished products in more than 685,500 tons. 6 of them are being overhauled, of which 1 will be resumed and 4 will be completed. This week, there are 17 blast furnace overhaul plans involving 13 steel plants and 32 blast furnaces, which are expected to affect hot metal production of more than 78.9 million tons per day. 8 of them are being overhauled, 1 are permanently shut down, 5 are planned to be overhauled, and 3 have been overhauled. From this week's survey, although the impact of steel plant overhaul has not increased significantly, with the deepening of environmental protection and production restriction, and steel market into the off-season, steel plants began to plan regular overhaul, and it is expected that steel plant overhaul or continue to increase in the later period.

Inventory data show that the national construction steel inventory continued to decline in the current period, with a total of 3.2327 million tons of threaded steel, a decrease of 104,600 tons compared with the previous period, and a total of 13.5561 million tons of wire rods and snails, an increase of 32,000 tons compared with the previous period. The price of the national construction steel market is lower. Due to the weakness of futures, there are many rainy days in recent days, and demand is not good. Although the steel mill Limited production and insured price, the overall supply pressure is not large, inventory continues to decline, but the current price is higher, lack of market confidence, low turnover mainly.

On the demand side, with the cold weather in the north and the increased haze and other factors, the demand for construction sites in the north will gradually weaken, and the demand for construction sites in the south is still in a relatively peak season, which also leads to the re-popularity of Beibulu in the south. Therefore, the inventory pressure in the north is not large, but the demand in the south is weak, but the demand in the south is still acceptable, but the inventory pressure tends to increase, and the overall base. This area tends to deteriorate.

In summary, Zhang Jinping said that because there is no news of a particularly good steel market in the current market, the futures market is weak and unchanged, and the spot price gap is large, there is still room for the spot market to make up for the decline, but due to the large recent decline, the space for further decline or narrowing. It is expected that the price trend of construction steel will fluctuate somewhat this week, or there will be frequent ups and downs, overall or weak, with a reference drop of about 50 yuan/ton. (source: China Securities Journal, China Certification Network)
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