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        Steel prices in the rapid fall after approaching the stage at the bottom

        Number of visits: Date:2012-08-28 12:04

        Steel high inventory, inventory Daobi mechanisms play a role. Along with the social stock had 4 weeks of continuous decline, steel stocks began to rise. Many people think that the steel industry fundamentals have not changed even worse, in fact in the steel industry chain, inventory of the first stage is often expressed as the social inventory, second stage performance for the steel stocks. When traders on the market is not optimistic, reduce or stop from steel stock, although social stock will fall, but the steel stocks will gradually accumulate. When the inventory of steel production of formation pressure, steel mills have price dumping, when low price to cash cost below, steel mills will stop production or maintenance. Therefore, now steel inventories high, price dumping is the inventory Daobi mechanisms at play. With the rapid downregulation of the ex-factory price of steel, steel profit situation gradually worsened, steel is expected to expand production scale.

        Traders cautious restocking, negotiable stocks at low. In March and September for the iron and steel industry more concentrated owing on the loan period, it has been very difficult for the iron and steel industry " one disaster after another ". Currently, major banks have to steel trade restrictions or stop borrowing, which makes the whole steel trade industry funds is nervous.

        Steel ore Qing Treasury serious, ore price drops the space is limited. Due to the recent iron ore price has been in decline, steel mills have reduced the amount of ore procurement, use of that buy way, the original steel ore inventory averaging can be used for about 1.5 months, the current steel ore inventory average which is used for about half a month, what is more, can only maintain a several day. Personally think that the recent ore prices is unlikely to drop, first of all, steel ore inventory clearance is almost finished, with a ton of steel to buy a ton of ore prices, which will form a support; secondly, the iron ore prices continued to fall, domestic mine production and output increase. Finally, at present steel no mass production, consumption to maintain the stability of the ore.

        Terminal consumption slowly. From July July macroeconomic data, fixed asset investment growth rate remained at 19.1%, than in the one or two quarter will be improve. The manufacturing industry investment growth rate is 26.7%, the highest for the year. Infrastructure investment growth rate for 15.3%, than the one or two quarter average increase. Only the real estate investment growth is weak for 9.6%, but with prices and sales picked up, it is expected that this data will improve. Overall, with the " golden nine silver ten " arrival of the peak season of consumption, the consumption of iron and steel industry terminal in slowly.

        Therefore, in the consumer slowly improved, if steel does not cut, the mine price drops the space is limited and will make the steel profits further variation, steel supply increases the likelihood of smaller; if steel production, the steel price drops the space is limited. No matter which one, short-term inside steel fundamentals are getting better, so that steel prices in the rapid fall after approaching the stage at the bottom.

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