The multi-party game of supply and demand, the weak steel market is bottoming out

At present, the global market demand is weakening, the inflation rate remains high, and the banking industry in Europe and the United States is in turmoil, injecting greater uncertainty into the world economic situation. As far as the steel market is concerned, the demand for steel for manufacturing will be subject to the double squeeze of insufficient orders from enterprises and weak profits. The demand for steel for infrastructure will be subject to the dual constraints of weakening the driving effect of special bonds and poor construction progress of projects. The demand for steel for real estate will It will also be subject to the double drag of poor effective construction of real estate projects and insufficient new construction.
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In the short term, the domestic steel market will show a pattern of “supply-side entanglement and production reduction, demand-side multiple constraints, and cost-side support insufficient”. From the perspective of the supply side, due to the first rise in steel prices and the rapid fall in raw material prices, the short-term loss pressure of steel enterprises has eased, and the implementation of production reduction operations and the willingness to resume production have strengthened the entangled game. The short-term supply side will show a situation of slight fluctuations .
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From the perspective of demand, due to the large-scale attack of high and rainy seasons, the weather will affect the construction progress of the project. At the same time, it will also be dragged down by the limited release of steel demand for manufacturing and steel demand for real estate, and the pace of terminal procurement will also be slowed down. slow.
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From the cost point of view, with the gradual implementation of the production reduction operation of steel mills, some steel enterprises have started to lower the ex-factory prices, which has also made the pressure on raw material prices more obvious. It is predicted that this week (2023.5.15-5.19) the domestic steel market will show a weak bottoming situation, and some regions or varieties may have the possibility of falling again.