中文
English
On December 23, the participants in the "Meeting with 2019 Yangchengye Commodity Investment Forum" held in Guangzhou said that China's economy still could not get rid of the two pillars of real estate and infrastructure. The trend of threaded steel and real estate is in line. The price of threaded steel is often underpinned by capital investment, and the supply of steel exceeds the demand in 2019. At different stages, there may be a situation of oversupply.
Wang Yingwu, director of black research at Huatai Futures Research Institute, said that the core logic of the rapid rise in commodity prices in this round is consumption-driven, and the main logic is environmental governance and risk prevention. On the one hand, the results of supply-side reform have been reflected in steel production profits, production restriction, environmental protection and their own capacity bottlenecks, resulting in the continuous constraints of pig iron production, but also formed a continuous low crude steel production. The rapid increase in scrap production and sales effectively compensates for the shortage of pig iron production in blast furnace. On the other hand, the rising consumption has led to the rising black market in this round.
In his opinion, real estate is still the main driving industry of steel consumption on the consumer side. The value and effect of infrastructure underpinning need to appear in the second half of 2019, but the price of infrastructure and industrial products is basically completely negative correlation. Manufacturing steel consumption is sluggish, automobiles, machinery and shipbuilding are showing obvious fatigue. Generally speaking, steel consumption is difficult to show a clear cliff-like decline, the probability is a steady decline, the growth rate is further reduced, or shows zero growth, but seasonally and rhythmically, there are still periodic outbreaks of consumption.
"The supply side is nearing the end, but not the end. It mainly focuses on the reduction replacement of production capacity, including the relocation of urban steel mills and the entry of industry into the park. Therefore, the next two years will not see the growth of production capacity, supply side is still slightly optimistic, there will be no industry-wide sustained losses. Environmental governance has basically failed, and the capacity to stop production will be significantly reduced, so it will bring about a significant increase in production, which is the biggest supply-side impact in the next two years. He said.
Finally, Wang Yingwu said that, on the whole, if strong policy interference is deducted, steel will change from a serious shortage of supply and demand to a balance between supply and demand, or even further deterioration. During this period, the supply and demand will still be mismatched by stages. Especially in the absence of any incremental supply of the three major steel raw materials, the cost will form an effective support. Therefore, prices will not go down unimpeded, and it is impossible to repeat the old road of 2013-2015.
(Source: Futures Daily)