Steel mills rose up to 100 yuan, but why steel prices have fallen

On July 10, domestic steel prices oscillated and fluctuated. Tangshan Pu's billet fell 10 yuan to 3380 yuan/ton. Due to the weakening of the steel mills futures market and the rise in spot prices, the steel traders' mentality tended to be cautious, speculative demand slowed down significantly, and high-priced resources were not well traded. The price of black futures fluctuated and fell. The rebar main product closing price was 3690, down 0.81%.

In the afternoon, merchants in some regions began to loosen slightly in order to obtain shipping prices, and the steel market transactions were still not very satisfactory. In terms of resources, the current inventory pressure of steel mills has declined, but the steel market is still facing some accumulation pressure.

The Central Meteorological Administration issued a yellow rainstorm warning, and 13 provinces will have heavy rain from the 10th to the 11th. As the futures fall back, the spot price is blocked. The high-price transactions in the market were not smooth, and wait-and-see sentiment revived.

On the one hand, under the influence of Meiyu, there is still accumulation pressure; on the other hand, steel prices continue to rise, high-price transactions are cautious, and under the influence of a sharp correction in futures, market sentiment weakens and the volume of construction materials has dropped significantly. However, at present, it is only a phased pullback, the market's high expectations are still there, and there is still room for upside after Meiyu.

The operation rate of 247 blast furnaces surveyed this week was 90.63%, a decrease of 0.39% from the previous month, and the average daily hot metal production was 2.477 million tons, a decrease of 0.72 million from the previous month.

Driven by rising financial markets and speculative demand, the trading volume of the steel market rebounded significantly in the first half of the week. The financial market cooled down near the weekend, and the trading volume of the steel market fell back to a high level.

In July, steel mills are routinely overhauled, and this week's reduction in molten iron is limited. Even if there are still steel mills overhauling and reducing production in the later period, the supply end may be difficult to shrink significantly.

On the whole, the steel market may return to the weak supply and demand pattern next week. Inventory is still under pressure, and steel prices may fluctuate. Considering the low profit of the manufacturers, the willingness to sell at low prices is not strong, and the adjustment range is not large.