Steel prices hit a 10-year high after the "past life future"

The current high prices of bulk raw materials for the middle and lower reaches of the profit squeeze has caused many concerns, but only in terms of the steel market, in our view, although the pressure of the stage of demand for steel prices have a drag, but difficult to change the supply contraction of the background of steel price trend.At present, the reality of strong demand superimposed long-term supply tightening of strong expectations, the domestic steel market rarely appeared "high profit, high output" and high prices coexist.China's crude steel production reached 271m tonnes in the first quarter, up 15.6% from a year earlier, CISA data showed.In early April, China Iron and Steel Association focus on statistics of steel enterprises crude steel daily production (with diameter) month-on-month growth of 2.88%, estimated national crude steel production month-on-month growth of 1.14%.

Since the first quarter, steel prices continue to go up and innovate high, become a hot market.The main reasons are, one: this round of steel prices rise short-term factors mainly from the supply and demand mismatch between the production limit and the peak season.Two: in addition to the continuous tightening of supply, strong demand is also driving this round of steel prices continue to go up an important factor.

Data show that after the spot price of steel broke through 5000, the market demand did not shrink significantly. So far in 2015, there have been a total of 12 single-day trading volume of more than 300,000 tons, and in April this year, there have been three single-day trading volume of more than 300,000 tons, including 350,000 tons of single-day trading volume on April 1, a record high.Jiang Wenmin pointed out that the last round of supply-side reform reduced steel capacity, but this time the proposed target is more direct, is to reduce output.In this context, the market generally for the second half of the steel production concerns.The performance on the futures plate is the forward steel virtual profit is higher.

Historically, spring demand is likely to last until around mid-to-early June.At present, the demand is still in the best stage of the year, but with the price center of gravity continues to rise, the cost burden of enterprises continues to increase, the demand margin may weaken ahead of schedule.It is worth noting that with the high steel prices, the policy side is also in many forces, not only to protect the supply of steel, but also to promote the reduction of production.The Tariff Commission of the State Council has decided to adjust tariffs on some steel products starting from May 1, 2021, in a bid to better guarantee the supply of steel resources and promote high-quality development of the steel industry, the Ministry of Finance said in a notice on Monday.

From the period of the medium - term trend, now the big market has completed the rise of three waves running.The main rising wave started in the year after the next year has risen from 4100 to around 5370 now, up about 30%. It is expected that the trend in the later period and the middle period will fluctuate at the high level.The upper 5500 is the pressure level for the medium term trend.

From the medium - term trend of iron ore, the large pattern is in an upward trend, now the medium - term trend in high shock adjustment.The upper 1180 is in a medium - term shock pressure position and is expected to continue to rise after a long - term adjustment.