Time flies, 2018 is about to pass, and after cold rolling entered the fast lane in November, the cold rolling market in December showed a steady decline. After the Sino-US trade war has eased and the steel market price has reversed, with the continued increase in environmental protection and production in autumn and winter, the cold rolling performance in December has become more rational and basically not too much, so the new year is coming, cold rolling. Whether the market can usher in a "open door", the author will briefly analyze this.
First, the output of steel mills continues to decline
Under the influence of environmental protection and insufficient demand in the off-season, the output of steel mills continued to decline this month. According to the data of Mysteel on December 13, in the 29 cold rolling production enterprises (a total of 47 cold rolling production lines), a total of 8 production lines were discontinued, and 12 production lines were unsaturated, with an overall operating rate of 82.98%. The chain decreased by 2.13% compared with last week; the capacity utilization rate was 78.47%, which was 0.98% lower than last week; the weekly output was 794,300 tons, a decrease of 0.99 million tons from the previous week. At present, the demand for end-use consumption in the off-season is getting weaker, and the demand for goods from middlemen is not improving. At the end of the year, the pressure on the withdrawal of funds is increasing. Some steel mills in the north are under heavy pressure, and there is little incentive to go to steel mills to order. It is also very weak, and steel mills are not motivated to produce.
Second, the inventory continues to decline
As of December 21, the Japanese network monitored 23 cities inventories. This week, the cold rolling inventory was 1.0764 million tons, a decrease of 115,000 tons from last week, a decrease of 71,200 tons from the previous month and an increase of 43,400 tons. The two banks' data of concern to the market continued to fall. This week, the factory library slowed down faster than the social library, indicating that the demand for resilience in the off-season is still there. Some of the demand for winter storage has begun to intervene. The market's worried accumulated nodes are obviously moving backwards. For many parties, it is a "good". At present, the business mentality is still cautious, mainly based on replenishment, and the 19-year macro expectations are not good, the winter storage will not be strong.
Late prediction
The international Sino-US trade war has tended to ease, and China has suspended taxation on American-made cars and parts for three months from January 1 next year, and the peripheral political risks have temporarily eased. Domestically, on December 13, the Political Bureau of the CPC Central Committee decided to stabilize the economic policy in 2019, and continue to implement a proactive fiscal fiscal policy and a prudent monetary policy, which will play a certain role in boosting the market. At present, the environmental protection and production quotas in various regions have increased, which has a certain positive effect on the market. However, the current winter storage price has not reached the trade-oriented psychological price and the demand has become weaker. Most steel traders have not been positive about the attitude of the winter storage. Still holding a relatively pessimistic attitude.
At present, it seems that demand in the off-season is weak and market confidence is relatively insufficient. Steel mills and traders are inevitably withdrawing from this round of short-term transactions by reducing production and clearing stocks. Protecting profits and avoiding losses is their current primary goal. However, the overall low inventory and limited production rumors have brought some support to the market, the long and short game is intensifying, the closer the winter storage is, the greater the price support pressure. With the characteristics of the winter season, the terminal demand is obviously weakening. Most steel traders are not active in the winter storage plan. In addition, the near-end of the month and the year-end are approaching, the merchants still have the pressure of funds, and the lack of demand is also the biggest constraint of the price rise. Look: there are signs of loosening on the policy side, hedging downward pressure, and long-term pessimism is expected to be repaired. On the spot basis, the current winter storage continues to lose heat, and the steel price is weaker. The downside space will not be too much due to cost support. The cold-rolling “open door” hope is not big. It is expected that the short-term domestic cold-rolling market price will fluctuate weakly. May be larger.
