Industry news

In the market research last week, several steel traders generally believed that this year's steel business is difficult to do. Gold, three, silver and four are the traditional peak consumption seasons in the steel industry, but the demand for steel has not been released. In the first two weeks of March, the sales volume of steel products fluctuated positively with the steel futures. The steel futures rose, and the sales rose; the steel futures fell, and the sales fell. Anyone with a discerning eye will know at a glance that this is driven by speculative demand. Some people say that the ex-factory prices of steel mills are rising, can the spot price of steel not rise? We just want to say that whether steel prices rise or not is not entirely determined by steel mills, but by the market. Why this year's steel market is not prosperous in the peak season? We think it is mainly caused by the following two reasons.

First, the real estate market is sluggish, and there are few new projects started by real estate companies. Real estate companies cannot sell their houses, and funds are very tight. Speaking of which, some people will definitely refute. Since this year, hasn't the central bank reiterated its major policy of supporting stable economic growth and providing strong financial guarantees for enterprises? The current situation is that due to the restrictions of the three red lines in the real estate industry, many large real estate companies cannot get loans, and a large number of small real estate companies working hard in third- and fourth-tier cities don’t even think about getting a copper plate from the bank. Most real estate companies basically choose to guarantee the handover of the building and survival when the sales are sluggish and the funds returned are small, and it is impossible to purchase steel in large quantities. The demand for real estate steel, which accounts for half of the total domestic steel market demand, has dropped sharply. Can the steel market demand increase?

Second, the new crown epidemic has affected the normal construction of construction sites. Since March, the epidemic prevention work of the new crown epidemic in various places has caused varying degrees of impact on construction site construction and steel supply and demand. As of March 15, many provinces and cities across the country announced the suspension of production and production. Among them, Jilin Province, which was most affected by the epidemic, announced on March 12 that the main steel warehouses in Changchun City were temporarily suspended, the local building materials market trading entered a temporary standstill, and the warehouse storage and local steel production were temporarily normal. Shenzhen announced on March 12 that all construction sites in the city will be temporarily suspended for 4 days for investigation. The steel market in Nanshan and Futian is expected to affect a total demand of about 6,640 tons, and Shenzhen is initially expected to affect the demand for construction steel by about 6 tons. At the same time, steel trade transactions in other parts of the country were also affected, some construction sites began to stop work, and logistics and transportation services were suspended.

Third, from January to February, in the face of multiple challenges such as the complex and severe international environment and the spread of the domestic epidemic, under the strong leadership of the CPC Central Committee with Comrade Xi Jinping at the core, all regions and departments earnestly implemented the decisions and arrangements of the CPC Central Committee and the State Council. Scientifically coordinating epidemic prevention and control and economic and social development, adhering to the principle of keeping stability at the forefront and seeking progress while maintaining stability, the national economy has continued to recover steadily, production demand has grown rapidly, employment prices have been generally stable, new drivers have continued to grow, and new progress has been made in high-quality development.