Amid the tension and anxiety in the market, the mutual tariff measures between China and the United States have actually hit the ground, as the SMM has previously made a risk note in the article: "beware of short profits, metals do not fall but rise."
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Metals have generally rebounded in the past two days, with copper and zinc being the most popular. Today's internal plate, Shanghai copper, coke, Shanghai zinc have floated red. By the end of the day, shanghai copper was up nearly 2.5%, up 6% from its lowest point this month. Shanghai zinc fluttered high, rising for two days in a row, closing up 4.17% today. The reversal of pessimism in the market was mainly boosted by the positive macro side: yesterday's meeting of the State Council called for the effective implementation of the tax reduction and fee reduction measures already set, and to step up efforts to make up for the shortcomings of infrastructure, and at the same time to determine measures to promote the growth of foreign trade. And further reduce the cost of import and export enterprises. Among them, infrastructure is an area in which the market has been pinning high hopes recently. How much driving effect will it have on the downstream demand of various metals?. Let's take a look at SMM's exclusive analysis:
Copper: at present, the weak copper price makes the price advantage of scrap copper do not lie, the price difference between refined copper rod and scrap copper pole is shrinking rapidly, there is almost no price difference between electric copper pole and scrap copper rod, the demand of scrap copper rod is weak, and the order flows to electric copper pole. In September, due to copper prices long-term low scrap copper holders under pressure, cherish the selling mood slightly improved, and cable companies before the capital shortage also slightly improved, from infrastructure and national network orders slightly increased. Infrastructure demand in the fourth quarter is expected to provide strong support for copper prices. The operating rate of large enterprises has improved significantly, and the starting rate of copper scrap rod enterprises is expected to be 43.86% in September, an increase of 5.32% from the previous month. And the arrival of the gold nine silver ten traditional consumption peak season, superimposed the upcoming Mid-Autumn Festival short holiday and the National Day up to 9 days long holiday, the market has certain expectations to the downstream stock.
Aluminum: the deficiency of infrastructure construction is mainly concentrated in transportation, rural areas and water conservancy, among which the construction of transportation facilities has the most demand for aluminum products. If the urban rail traffic construction is vigorously carried out, the demand for rail aluminum profiles and aluminum cables and other products will increase to a certain extent, or will accelerate the recovery of consumption. However, considering the short-term positive and negative factors of aluminum, the influence of infrastructure is limited. Aluminum prices are still more concerned about Hydro's return to production expectations and heating season production restrictions and other basic reasons. Therefore, SMM believes that although infrastructure may boost aluminum prices from the consumer side, but the impact is limited, if the overall macro atmosphere slightly improved, the short-term expected Shanghai aluminum main operating range of 14300 to 14700 yuan / ton.
Steel: so far, 172 major water conservancy projects have been built, with an investment of more than 1 trillion yuan, Meng Wei, a spokesman for the National Development and Reform Commission, said at a press conference on the afternoon of September 18. We will speed up the construction of high-standard farmland. A number of major railway projects have been completed and put into operation. On the premise of resolutely and effectively preventing the risk of local government debt, the NDRC will step up efforts to make up for the shortcomings in the field of infrastructure. SMM steel analysis believes that in the case of tighter real estate investment, the Politburo economic meeting in the middle of this year decided to increase infrastructure, ensuring infrastructure demand in the second half of the year. In terms of hot coil, the overall capital construction is more related to the demand for building materials, and the impact on the price of hot coil is mainly stimulated by varieties. Heavy machinery excavators, steel structures and so on are more obviously driven by the infrastructure policy.
The latest statistics show that from January to August this year, sales of 25 major excavator companies refreshed the highest level in history for the same period, up more than 50% from a year earlier. It usually takes two weeks for excavators to arrive, according to an excavator sales manager. Industry insiders said that the market demand of the excavator industry is greatly affected by the scale of investment in national fixed assets and infrastructure construction, and the downstream is mainly investment-intensive industries such as infrastructure, real estate, mines, and so on, which is closely related to the macro-economy. At present, the whole excavator industry shows the characteristics of strong cycle, because the downstream start-up is better, and the equipment invested in the last peak has entered the updated peak, so the sales volume is higher. In the process of improving the concentration of the industry and localization, the performance of domestic construction machinery leading companies is also very bright. According to the data in the newspaper, Sany heavy Industry (SH600031), the industry leader, had operating income of 28.124 billion yuan in the first half of this year, an increase of 46.42 percent over the same period last year, and a net profit of 3.389 billion yuan, an increase of 192.09 percent over the same period last year.
Zinc: in the context of low inventory, due to the convergence before and after the Mid-Autumn Festival National Day holiday, only four trading days have passed after the return of Mid-Autumn Festival short holiday, that is, the National Day Golden week, which is a non-trading day of up to nine days, and the downstream of spot trading stagnation needs to be prepared in advance. Low inventory and strong consumer demand collision, Shanghai zinc warehouse upward lead non-ferrous. Since the country often released the demand for infrastructure deficiencies, the third quarter of infrastructure investment into the volume period, with the gradual landing of the project, infrastructure, real estate-based galvanized consumption is expected to pick up. According to SMM, due to the time difference between the landing of infrastructure investment and the delivery of project orders to physical enterprises, the overall galvanized consumption in September is in a state of low peak season, and the overall construction has not yet returned to the peak season level, but for the boost of infrastructure investment to galvanized consumption, Companies still have expectations.
Nickel: compared with other non-ferrous metal varieties, stainless steel accounts for the lowest proportion of infrastructure and real estate demand and consumption, that is to say, among its downstream demand, there may be more and more scattered use. For example, consumer durable goods, machinery and equipment, and so on. From a macro point of view, demand in the second half of 2018 is expected to be lower than the same period last year, the second half of last year exceeded expectations, there is a good chance that it will not happen again this year. And because of the high growth base in the second half of last year, SMM analysis expects a demand growth rate to be weak in the second half of this year.
But if we look at stainless steel, because it still faces some population-related demand, that is to say, the reduction in stainless steel demand and the decline in growth will not seem very abrupt. Like other non-ferrous metals, demand performed very well in April and May 2018, but stainless steel demand showed seasonal weakness in July and August.
Overall, the demand for stainless steel, due to its demographic relationship and consumption escalation factors, its demand growth rate will maintain a relatively stable situation.
Interpretation of the report on infrastructure work of the National Development and Reform Commission: make up for the shortcomings of the board! Traffic infrastructure in central and western China is ready for development
On September 18, the National Development and Reform Commission held a press conference on strengthening efforts to make up for shortcomings in infrastructure and other areas, stable and effective investment, and answered questions from reporters. Meng Wei, deputy director of the Policy Research Office of the National Development and Reform Commission and spokesman for the press, said: at present, tasks in various key areas have advanced smoothly, and positive results have been achieved in mending shortcomings. Next, we will focus on making up for weaknesses, strengths and weaknesses, and on the premise of resolutely and effectively preventing the risks of local government debt, we will step up efforts to make up for weaknesses in infrastructure and other areas, make stable and effective investment, and constantly improve the efficiency of investment.
Since the beginning of this year, the structure of fixed asset investment has been continuously optimized, but the growth rate has slowed month by month. It rose 5.3 per cent from a year earlier in the January to August period, down 0.2 percentage points from January to July. On the whole, the growth rate of manufacturing investment and private investment has picked up, indicating that the investment structure is constantly optimizing, "Liu Shihu said in an unreleased statement. At the same time, the growth rate of infrastructure investment has slowed, and the total investment planned for new projects has dropped sharply, reflecting the lack of stamina for investment growth and the need to strengthen efforts to make up for shortcomings in the infrastructure sector and to make up for stable and effective investment. "
Stimulated by this news, the internal futures market industrial products rose, A shares continued to rise. The A-share index opened lower across the board, and then rose. At present, the main index has changed from falling to rising, with the Shanghai and Shenzhen 300 rising more than 1.2 percent, the Prev index and the Shenzhen Composite Index up more than 1.1 percent, and the Prev index recovering the 20th and 30th consecutive lines. Building materials, infrastructure, real estate stocks strong performance.
The whole line of building materials plate is floating red.
One of the ways to make up for the shortcomings-the acceleration of Infrastructure Construction in the Central and Western regions
The focus of infrastructure development is to make up for the shortcomings, and the intensity of infrastructure in the central and western regions is expected to be further strengthened. Although China has been developing for many years and the level of infrastructure construction has been continuously improved, there are still some shortcomings.
1) from the regional point of view, the infrastructure investment in the central and western regions is relatively insufficient;
2) from the point of view of urban and rural areas, the infrastructure construction in rural areas is relatively backward;
3) from the field point of view, the infrastructure construction of electric power, communication, underground pipe network and environmental treatment is still not perfect.
The special debt limit in the central and western regions has increased considerably this year, and the completion rate of fixed asset investment in the western region in the first half of this year is significantly lower than that of last year, indicating that infrastructure investment in the central and western regions is expected to accelerate in the second half of the year.
From January to July 2018, the amount of new intended investment in East, Central, West and Northeast China increased by-20.3%, 63.9%, 11.9% and 32.7% respectively over the same period last year. The growth rate was 3.5, 8.4, 3.9 and 11.5 percentage points lower than in January and June, respectively.
From January to July 2018, the top 10 regions with year-on-year increases in new intended investment were Jiangxi, Tianjin, Heilongjiang, Jilin, Shandong, Chongqing, Shaanxi, Henan, Hubei and Shanghai. The top five new investment projects are Yunnan, Gansu, Guangxi, Shanghai and Hainan.
The second part of making up for the deficiency-the Traffic Infrastructure is ready to be launched
In the infrastructure sector, the growth rate of new intended investment is faster than the same period last year in postal services, ecological protection and environmental management, while the faster decline is in pipeline transport, railway transport, air transport and road transport, with a reduction rate of more than 40%. The top three sectors were public facilities management, road transport and railway transport, with 28.3%, 25.2% and 15.4%, respectively.
Changes in the proportion of new intended investment in various industries in infrastructure
Transportation infrastructure has the characteristics of long industrial chain and strong driving function. Since the 13th five-year Plan, the proportion of transportation fixed assets investment in fixed assets investment has been maintained at about 5%, which plays an important supporting role in stabilizing economic growth. In the two years before the 13th five-year Plan, investment in fixed assets in transportation continued to run at a high level, with a completion amount of more than 6 trillion yuan, and 1.6 trillion yuan from January to July this year, a slight decrease compared with the same period last year. From the current understanding of the situation, the number of new projects in various localities has been reduced, and the stamina for the growth of transportation investment is insufficient.
In the next stage, the key path map of China's investment has emerged: transportation infrastructure undoubtedly plays an important role, no matter the number of projects or the amount of money are "pick up the beam", environmental protection, information, people's livelihood and other related areas of infrastructure has also become a new hot spot. The total investment in new infrastructure projects launched this year is expected to reach trillions, and the investment pull effect will begin to appear in the fourth quarter.
At present, the China Railway Corporation has confirmed that railway investment will return to 800 billion yuan this year. The Civil Aviation Administration and the National Development and Reform Commission have jointly released the "list of projects encouraging Private Investment in the Civil Aviation sector." the total investment in 28 projects is expected to reach 110 billion yuan. The National Energy Administration has made it clear that nine key transmission and transformation lines will be approved this year and next, seven of which are UHV projects, which will be restarted after an UHV period of more than a year. After a year of suspension, the National Development and Reform Commission last month restarted the examination and approval of urban rail transit projects, and the urban rail transit construction plans for Changchun and Suzhou have been approved. A new round of urban rail transit planning for Hefei, Xi'an, Wuhan, Chengdu and Taiyuan has been reported for approval.
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