The steel industry is still cautious in the turning point in September

Since the steel industry entered a rebound in late September, social inventories have fallen significantly. The rebound kinetic energy since late September is mainly the transfer of steel products in the industrial chain. After the steel industry experienced a unilateral plunge in the third quarter, steel prices and ore prices have fallen significantly. At the same time, steel traders and downstream manufacturers compressed their inventory to the limit. Since the steel price started to rebound before eleventh, plus the effect of the eleven long holidays, the downstream began to increase the stocking, making the demand “amplified”. It can be said that the most significant feature of this round of rebound is the internal inventory transfer in the industrial chain caused by downstream restocking.

Through the grassroots research of small and medium-sized manufacturers, including steel mills and downstream users, the analysis concludes that the current downstream demand is slowly recovering, and the recovery speed of building materials, infrastructure, and related industries for long products is better than that of automotive and home appliance machinery. industry. Small and medium-sized manufacturers are cautiously optimistic about the market outlook. On the one hand, the demand for steel will decline in the off-season after the “Silver 10”; on the other hand, the current round of increases brought about by the superposition of the dual factors of downstream stocks and demand will continue, and there will be room for continued growth in crude steel production. However, crude steel production, ie supply, is a decisive factor.

In general, although the downstream demand of the steel industry has slowly recovered, and the valuation of the industry is also close to the historical bottom, due to the overcapacity of Damocles, the sword is still hovering. The future is still cautiously optimistic about the recovery of the steel industry.