The fundamentals are weak, and the steel price is short-term attention to the support below.


Since May, steel futures have remained volatile. As of yesterday (17th), the main contract of rebar closed at 3,679 yuan / ton, up 0.14% in the day; the main performance of the hot coil was relatively strong, and closed at 3,847 yuan / ton yesterday. The day rose by 1.08%. Analysts pointed out that from the recently released market data and macro data, steel mills are driven by higher profits, production enthusiasm is higher, market supply is increasing, and the real estate market in the downstream major areas may weaken in the future, short-term steel prices or testing Support below.

Future demand drags steel prices

According to the National Bureau of Statistics, China's crude steel, pig iron and steel output in April were 76.7 million tons, 63.11 million tons and 92.27 million tons, respectively, up 4.8%, down 0.4% and 8.5%. The average daily output of crude steel, pig iron and steel in April was 2,556,700 tons, 2,013,700 tons and 3,075,700 tons respectively, which was 7.13%, 7.86% and 6.21% higher than the average daily output in March.

“From this point of view, although since March, although the environmental protection policy is still, but the profit is driven, the steel mill has a high production enthusiasm, and some steel mills have resumed normal production, and the market supply will gradually increase.” Analyst analysis, although the current steel continues Going lower, but the speed of destocking has slowed down, especially in steel mills. The southern plum rain season is coming soon, and the future steel inventory continues to decline. The power is relatively limited. Before the hot summer in the north, the large inventory base will definitely drag down the steel price.

From the perspective of downstream demand, China's real estate development investment in January-April increased by 10.3% year-on-year, and the sales area of commercial housing increased by 1.3% year-on-year, a three-year low, and the growth rate in January-March was 3.6%. From January to April, the funds for real estate development enterprises reached 4.8192 trillion yuan, a year-on-year increase of 2.1%, and the growth rate dropped by 1 percentage point from January to March.

Huatai Futures analyzed that in April, real estate sales and infrastructure data fell, and growth was a concern. Since last year, the growth rate of infrastructure investment has slowed down. On the one hand, it has some relationship with the high base of last year. On the other hand, the government has adopted measures such as standardizing the clean-up of PPP projects and regulating local debt financing activities. It is expected that the decline in the growth rate of real estate sales will lead to the decline in construction, the downstream demand will be weaker and the steel prices will be under pressure for a short period of time.

Focus on the lower support position

In terms of weather, the southern rainy season is concentrated in June and July. "This will have an impact on the transportation and transportation of steel. After the rainy season, the northern summer will follow, which will hinder the progress of the construction site. At that time, the steel price will be dragged down." On the other hand, the environmental protection policy has always implemented the steel industry. The environmental protection winds have fluctuated from each other. The production-restriction policy has been wave after wave, which has suppressed the output of steel mills. However, the environmental protection policy is two-way. The downstream processing plants also exert pressure at the same time, so they restrain the supply and restrain the release of demand.

"Comprehensively, both supply and demand will be weakened in the future. It is expected that steel prices in the middle and late May will be weakened overall." Analysts expect.

Founder Mid-term Futures analyst Tian Xinyu analyzed that the main tasks of the supply-side reform of the steel market are completed and structural reforms are restarted. The real estate policy has turned to inertia, and real estate investment, new construction and other indicators have fallen from the previous month. The demand for construction steel has peaked in the medium and long term, and there is still inertia in the short to medium term. "Technically, the rebar futures 1810 contract short-term lightening shocks, short-term operation focus on the support below 3650 yuan / ton, hot rolling main 1810 contract concerned below the 3750 yuan / ton -3780 yuan / ton support, pay attention to the position."