The steel market is not prosperous in the peak season, and the "evil disease" of high production capacity and high inventory is difficult to eliminate
the sudden magnitude 7.0 earthquake in Lushan County, Ya'an City, Sichuan Province last weekend also brought a glimmer of dawn to the steel market in addition to the national grief, because post disaster reconstruction is conducive to accelerating the pace of destocking in the steel market. From historical experience, the steel demand created by this earthquake is expected to be difficult to match the steel consumption caused by the Wenchuan earthquake. In general, drizzle cannot quench the thirst for long-term drought, and short-term benefits are difficult to reverse the weak pattern caused by the shortcomings of the medium and long-term industrial chain
on the other hand, this year, the domestic steel market failed to show the peak season characteristics of "gold, silver and four", but the output and inventory performance were "active". In the first ten days of March, after the domestic average daily crude steel output just hit a record of 2.085 million tons, less than a month, experienced mechanical and electrical personnel were sent to the user's factory to be responsible for the installation, commissioning and trial production of equipment, and the output hit a new record, soaring to 2.2139 million tons. In the case of poor terminal demand, such a large supply pressure cannot be released at the end of the industrial tightening chain, and can only be hoarded in the inventory link. As of April 19, the social inventory of 29 key cities across the country was 19.792 million tons. Although the social inventory has decreased for four weeks, it is still increased by 10.4% over the same period last year, especially the inventory of building materials, which increased by 19.19% over the same period last year. In the face of the current situation of the steel market with high output, high inventory and low demand, if the steel mills do not take the initiative to reduce production, the steel price will have no choice but to move forward in the future. According to the survey results, the maintenance of blast furnaces in Tangshan steel plant was not ideal in the whole April. As of last week, only 5 of the 155 blast furnaces in production in the region had been overhauled, and the blast furnace operating rate was about 96.77%. It is worth noting that since this year, the blast furnace operating rate in Tangshan has always remained above 90%
coke production hit a new high, and it is difficult to reverse the weakness in the future.
the terminal steel market shows fatigue. The lack of procurement by steel enterprises has led to a sharp decline in coke demand for 1 + 4 hot continuous rolling and 1 + 2 cold rolling technology, while coke enterprises have not prepared for sudden changes and adjusted production capacity as soon as possible. According to statistics, the domestic coke production in March was 40.5 million tons, up 11% month on month and 5% year-on-year, setting a new record high again; In the first quarter, the coke output reached 114 million, with an average monthly output of 3. We have long protected 8.04 million tons of new and old customers, with a rapid growth rate compared with the same period in history. Under the heavy pressure of high production, Tianjin Port inventory has always been high. As of April 22, the coke inventory was 2.15 million tons, far higher than the level of the same period over the years
the coal coke steel industry chain suffers from the dual ills of high production capacity and high inventory. In the absence of policy support and strong economic recovery, weak terminal demand will be difficult to break