Lange Forecast: multi-party game reappearance steel market weakening shock

In the 43rd week of 2023 (2023.10.16-10.20), the national absolute price index of Lange Steel was 4065 yuan, up 0.2% from last week and down 3.7% from the same period last year. Among them, the absolute price index of Lange steel long material was 3,887 yuan, up 0.6% from last week, down 5.3% from the same period last year; The absolute price index of Lange steel profiles was 3972 yuan, down 0.2% from last week and down 7.4% from the same period last year; The Lange Iron and steel sheet absolute price index was 4167 yuan, down 0.1% from last week and down 1.0% from the same period last year; The Lange steel pipe absolute price index was 4532 yuan, down 0.3% from last week and down 7.0% from the same period last year.

According to Lange steel network monitoring data show that in the 43rd week of 2023, the price changes of 17 categories of raw steel fuel and steel products in some parts of the country are as follows: The main steel varieties market price range oscillations, compared with last week, rising varieties have increased, flat varieties have increased, and falling varieties have decreased significantly. Among them, 8 varieties are up, 8 more than last week; 19 varieties were unchanged, 11 more than last week; Sixteen species fell, 19 fewer than last week. The domestic steel raw material market was slightly shaken, iron ore prices rose 5-20 yuan, coke prices remained stable, scrap steel prices fell 20 yuan, billet prices rose first and then fell.

Figure 1 Lange Steel Price Index change trend chart

Since the beginning of this year, in the face of a complex and severe international environment, China has implemented precise and effective macro-policy regulation, focused on expanding domestic demand, boosting confidence, and preventing risks. The national economy has continued to recover, production and supply have steadily increased, market demand has continued to expand, the quality of development has steadily improved, and positive factors have accumulated. However, we should also note that the external environment is becoming more complex and severe, domestic demand is still insufficient, and the foundation for economic recovery still needs to be consolidated. We should further expand effective domestic demand, strive to stimulate the vitality of business entities, do a good job of implementing policies that have been introduced, and continue to strengthen the internal driving force, continue to improve social expectations, continue to resolve risks and hidden dangers, and further consolidate the foundation for economic recovery.

In the short term, the domestic steel market will show a pattern of “intensifying geopolitical conflicts, interest rate hikes in Europe and the United States are expected to be suspended, the domestic economy continues to recover, the accumulation of positive factors is increasing, the foundation for good still needs to be consolidated, the production reduction process is once again waves, and the demand for rush work is expected to be released.” From the supply side, steel mills have entered the process of production reduction due to losses, but the process has also resurfaced, and there may be a problem of “big thunder and small rain” in production reduction. From the demand side, “Silver Ten” is still the traditional construction season, and there is a phenomenon of project rush in some areas, which stimulates the release of terminal demand, but there are obvious differences in the intensity of release between different regions. From the cost side, iron ore prices have fluctuated slightly, scrap prices have declined steadily, and coke prices have remained stable, making cost support maintain a certain toughness. According to Lange steel weekly price forecast model estimates, next week (2023.10.23-10.27) the domestic steel market will continue to recover in the economy, production cuts again waves, rush to release demand, cost resilience support and other factors under the common influence, showing a weaker shock market.