Steel price forecast of this week

Last week the main steel varieties increased significantly, falling varieties significantly reduced. Raw material market, iron ore price up 25-30 yuan, coke price down 50 yuan, scrap price up 40-50 yuan, billet price up 90 yuan, the overall shock rebound trend. How will the market go this week?

First, there are the following factors affecting the steel market

1, the US non-farm exceeded expectations for the 14th consecutive month

On June 2, Labor Department data showed U.S. nonfarm payrolls added 339,000 jobs in May, above expectations of 195,000, beating expectations for the 14th straight month and the biggest increase since January 2023.

2. China Steel Association: Social steel inventory in late May fell 5.8%  

China Steel Association released data, in late May, the social inventory of 5 varieties of steel in 21 cities was 10.31 million tons, a month-on-month decrease of 630,000 tons, down 5.8%, the inventory decline expanded; It was 1.2 million tons less than that in late April, down 10.4 percent; An increase of 2.79 million tons, or 37.1%, from the beginning of the year.

3. Policies to increase investment and promote consumption are frequently introduced

According to incomplete statistics, since the second quarter, more than 20 provinces have introduced measures to promote consumption, including issuing consumption vouchers, consumption subsidies, reducing vehicle purchase tax, etc., to stimulate consumption potential in all areas.

Second,stock market

This week rebar: steady downward

Most merchants in the market believe that the fundamentals of supply and demand or no significant change, the price is still basically relying on the iron ore end of the news in support, positive news or excessive amplification, or difficult to form a substantial boost to the spot price rise, is expected to be stable next week steel bar strong operation.

Hot roll of the week: Mixed

In terms of the market, the recent macro news stimulated the futures board to fluctuate up, boosting the market sentiment, the increase of inquiries, coupled with the speculative demand is not bad, the terminal purchase intention is strong, so the inventory also continues to keep the state of inventory reduction, it is expected that the hot roll volatility will become stronger next week.

Mid-board this week: weak stability adjustment

The recent rebound of the futures market is not obvious for the boost effect of the mid-board, the overall mid-board resource price is still high, the upward momentum is insufficient, the cost, supply and demand and macro logic has not changed fundamentally, still need to observe the strength of spot shipment and the transformation of contradictions, is expected to adjust the mid-board shock operation next week.

This week’s strip: shock up

Driven by recent news and emotions, the disk holds the red shock, but at this stage is in the off-season demand, there is still greater pressure downstream, negative feedback has not yet ended. At present, the downstream steel mills continue to maintain low inventory levels, limited demand release, is expected to narrow strip adjustment next week.

Profile of the week: Slow down before lifting

In the past two days, the price of section steel has shown a certain trend of recovery, and the issuance of special bonds in the market has alleviated the financial pressure on the downstream, benefiting more than the price operation of section steel. However, it should be noted that with the arrival of the national hot and rainy climate, the downstream construction progress may be blocked, and it is expected that the section steel will run slightly stronger next week.

Tubing of the week: Weak operation

This week, the price of strip steel rose significantly, the rise of raw material prices or pipe prices next week to form support. At present, the production of pipe factory maintains the normal level, and the inventory pressure in the factory is not obvious. However, the profit of the factory is slowing down at present, and the market supply is likely to increase further. It is expected that the pipe will run steadily and become stronger next week.

Third, raw material market

Billet of the week: Steady to the upside

The profit of downstream billet section steel has been restored, billet in the plant is low, and the operation has been greatly increased. At the present stage, the growth of billet demand is significant. The social inventory of billet is accelerating this week.

Iron ore this week: slightly higher

Iron ore demand is still high at this stage, supply is relatively stable, short-term iron ore price elasticity. In addition, the main iron ore contract on Friday strong significantly up, the market has strengthened significantly, the overall activity of traders has increased, expected next week iron ore shock strong operation, but the range is limited.

Coke of the week: Weaker run

This week coke launched the tenth round of drop, drop 50-100 yuan/ton. Coke enterprises profit space continues to narrow, but the current coke supply is still loose, steel inventories at a normal level, and steel enterprises replenish inventory is poor, coke is expected to run weak next week.

Scrap of the week: A slight rebound

Scrap resources tight this week, superposition part of steel companies have replenishment demand, tentative pull up suction goods, but considering that the current sales of finished materials is not ideal, steel profits have not been repaired, scrap upside limited space, scrap shock adjustment operation is expected next week.

Pig Iron of the Week: Weak adjustment

The pig iron enterprises in the factory inventory decreased significantly, pig iron supply pressure reduced, the contradiction between supply and demand slightly eased, but considering the cost is expected to be weak, merchants shipping intention is strong, the transaction center of gravity is still probing, is expected to be stable in the weak pig iron operation tomorrow next week.

Iv. Comprehensive view

Macro expectations improved this week, helped by the resolution of the debt ceiling issue and the likelihood that the Federal Reserve will pause interest rate hikes in June. From the basic point of view, the short-term production of molten iron is still high, the expected production cut in the market has not been fulfilled, the supply is generally maintained at a high position, coupled with the arrival of hot and rainy weather, rigid demand is difficult to continue to grow. Short-term rebound market will also appear in the shock, steel price stability is expected to run in the next week, the range of 30-50 yuan.