How will the scrap price go in October

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How will the scrap price go in October

on the whole, after the steel billet stabilizes, the scrap price operates stably as a whole. At the same time, with the increase of the resumption of production of electric arc furnace in the later stage, the scrap demand is still supported, and the scrap price may continue to rise after a narrow decline in the future

(I) in terms of macro-economy and policies

[the gross domestic product of national new areas in 2016 was about 4trillion yuan] at the third national new area work experience exchange meeting and new area work promotion meeting held in Zhoushan Islands, Zhejiang Province on the 26th, Lin nianxiu, deputy director of the national development and Reform Commission, said that in 2016, 19 national new areas across the country achieved a regional gross domestic product of about 4trillion yuan, accounting for about 0.2% of the population and area of the country, It has created an economic aggregate accounting for 5.4% of the country's total economy and has become an important engine for national economic development...

[in the first eight months of this year, the profit of state-owned enterprises was nearly 2trillion yuan, and the overall leverage ratio to occupy the domestic high-end composite market fell by 4.7%] on the 26th, the Ministry of Finance learned that in the first eight months of this year, the economic operation of state-owned and state-owned holding enterprises was stable and good, and the income and profits of state-owned enterprises continued to grow rapidly, of which the total profit was close to 2trillion yuan, The year-on-year increase was more than 20%. Steel, nonferrous metals and other industries performed better, while the profits of power and other industries fell significantly year-on-year. In response to the problem of leverage ratio of state-owned enterprises, which is highly concerned by the market, the national development and Reform Commission said that from the latest data, the leverage ratio of state-owned enterprises has declined for several consecutive quarters. In the future, it will study and establish a strict warning line for the debt ratio by industry

[the price of steel and chemical products continued to fall in September, and the increase of PPI is expected to slow down] on September 25, the National Bureau of statistics released data showing that the prices of rebar and hot-rolled plate in the circulation field fell by 1% and 1.3% respectively compared with the previous ten days, while the price of electrolytic copper fell by 3.9% and PVC fell by 3.8% in the same period. According to the survey of 21st Century Business Herald, since September, the steel price has continued to consolidate downward as a whole, especially in the second ten days of September, the price fell significantly. This situation also appeared in some non-ferrous and chemical products, and the price rise of the traditional "golden nine silver ten" means of production did not appear

[the proportion of new economic drivers in GDP in 2017 is expected to reach 12%] data show that from August 2015 to August 2017, the average proportion of China's new economy in the overall economic scale was 31 According to international practice, it is about 0%, accounting for about one third of China's overall economic scale. In 2014, China's new economic momentum accounted for about 8% of GDP, with an annual growth rate of about 1 percentage point. It is expected to reach about 12% in 2017. According to the established requirements of the national plan, the overall goal of at least 15% will be achieved in 2020. Taking strategic emerging industries as an example, it is expected that by the end of 2017, the added value of the lubricant analysis industry will account for about 10% of GDP

(II). On the basis of supply and demand

it is estimated that the crude steel output will continue to decline slightly in the middle of September. The estimated crude steel output nationwide is 23.6518 million tons, with a daily average output of 2.3652 million tons, a decrease of 0.22% from the first ten days of September. Since September, the proportion of blast furnace resumption of production and overhaul of iron and steel production enterprises in North China, Northwest China, East China and other regions has increased significantly compared with August. Coupled with the small-scale changes in equipment resumption of production in southwest, Central South, northeast and other regions, and the capacity utilization rate of short process steel-making enterprises continues to increase slightly, as a whole, the national average daily crude steel output in September has decreased significantly compared with the month on month, and still maintained a slight increase year-on-year. Judging from the current production situation of enterprises, it is expected that the daily average output of domestic crude steel may continue to decline in the late part of this month

in terms of price, the steel spot market price volatility weakened in mid September. As of press time, the steel composite price index was 153.38, up 2.04% month on month. In terms of varieties, the price index of long timber increased by 1.66% month on month, and the price index of flat timber increased by 2.51% month on month

(III). Scrap inventory and supply and demand

as of September 22, 45 steel mills' scrap statistics with the same caliber showed that the total inventory was 1.85 million tons, an increase of 132000 tons over the previous week, an increase of 7.68%. Taking the most frequently used 28*42cm fully biodegradable bags as an example, an increase of 21.3% over the previous month. Affected by the decline in finished product prices, the purchase price of scrap steel in steel mills has fallen, which has stimulated the arrival of some markets. In the short term, the inventory of scrap steel in steel mills will still rise slightly, and the market price may continue to be under pressure

Chart: change chart of scrap inventory of domestic mainstream steel mills in

as of September 22, 53 independent EAF steel mills across the country were surveyed, with an average operating rate of 70.1%, up 1.47% from last week; The capacity utilization rate was 56.09%, an increase of 2.11% over the previous week. Month is still the peak of investment in electric arc furnace steel plants, and the operating rate of electric arc furnace steel plants will continue to rise, and the resulting demand for scrap steel will also support the price of scrap steel to a certain extent

figure: the operating rate and capacity utilization rate of 53 independent short process steel plants

scrap demand in October still has a certain support. Within the scope of the investigation, the resumption of production of electric arc furnaces in eastern and southern China has increased the demand for scrap steel to a certain extent. At the same time, according to customs information, since October 1, 2017, the amount of customs declaration guidance for scrap iron export of Customs across the country: 1050/ton of unified waste, 1600/ton of heavy waste, and the tax has increased, which will affect exports to a certain extent, but at present, there are still inquiries about scrap steel export, This will also enhance the confidence of the scrap yard to a certain extent. At the same time, the price difference between scrap steel and pig iron is still high, the enthusiasm of steel mills to use scrap steel is still unabated, and the problem of scrap steel tax tickets is also expected to have a new look in October

on the whole, after the national day and Mid Autumn Festival holidays in October, there is a demand for replenishment in the market, and scrap steel is still cautiously optimistic as a whole. However, it should also be noted that after October, the production restriction policy of 2+26 cities may affect the demand of the north to a certain extent, thus gradually transmitting to East and South China. On the whole, the scrap market may still have room to rise after weak consolidation, but we need to pay attention to the changes between different regions and different material types. It is expected that the price of crushed materials in the later stage will remain strong, while the price of light and thin materials may be relatively weak

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