Shagang rose 150, futures steel fell below 3800, steel prices fluctuated

On August 11, domestic steel prices went up and down, and Tangshan Pu's billet rose by 10 to 3440 yuan/ton. On the one hand, due to high cost pressure, mainstream steel mills such as Shagang and Baosteel raised prices. On the other hand, the actual downstream demand for steel is not picking up strongly, and there is a fear of heights. The current steel market is intertwined with longs and shorts, and steel trade merchants are in confusion. The main force of the futures snails opened higher and lowered. The closing price of 3795 fell 0.68%, falling below the 5-day and 10-day moving averages.

In July, RMB loans increased by 992.7 billion yuan, a year-on-year decrease of 63.1 billion yuan; at the end of July, M2 increased by 10.7% year-on-year, and the growth rate was 0.4 percentage points lower than the end of the previous month. Monetary policy has been adjusted from ultra-loose to structurally loose. The July financial data was worse than expected, which may be the main reason for the late dive of the financial market today.

Domestic steel prices entered a short-term adjustment after a strong pull in early August. Before steel demand is fully released, the room for further increases is relatively limited. From the perspective of steel mills' price adjustments, the willingness to keep prices is still strong, short-term steel price adjustments are not large, and medium-term bullish sentiment is strong.

The Central Meteorological Observatory reported on the 11th that Beijing-Tianjin-Hebei and other places will see the strongest rainfall since the flood season. It is expected that from the 11th to the 13th, there will be a large-scale heavy rainfall process in the north, and there will be moderate to heavy rains in the east of the northwestern region, Inner Mongolia, northern China, northern Huanghuai, and northeastern regions. There will be moderate to heavy rains, local heavy rains or heavy rains, Beijing-Tianjin-Hebei and other places. Local area 150-200 mm, accompanied by short-term heavy rainfall. Rainy weather will affect the transportation and downstream construction in the northern market, and short-term demand release will slow down.

It is estimated that in the first ten days of August, the national average daily output of crude steel was 2,982,300 tons, an increase of 6.50% from the previous ten-day period, and another record high in ten-day history. Although the output of construction steel decreased slightly in the first half of August, the output of pig iron and crude steel is still increasing, and high supply pressure still exists.

In recent weeks, the quantity of iron ore arriving at the port has remained at a high level, and the port has also been stockpiled. The supply and demand of iron ore has shown a booming trend. Taking into account the market's fear of high sentiment, the price of ore may be hindered in the later period, but the prices of raw materials such as coke and scrap steel are relatively strong. Under the pressure of high cost, mainstream steel mills such as Shagang and Baosteel raised prices.

The current supply and demand in the steel market is still in a weakly balanced pattern, and the increase or decrease in inventory is not large. The market divergence between longs and shorts intensified, mainstream steel mills raised prices, and the steel futures market plunged late. In the short term, steel prices may fluctuate, with limited fluctuations.