The April policy has given much boost to thread demand, and the market should not be overly pessimistic.

[review this week]:

On March 23, (Andrew Mackenzie), CEO of BHP Billiton, the world's largest mining company, said at the 2019 China Development High-level Forum that the "Belt and Road Initiative" initiative is expected to generate additional demand for 1.6 million tons of refined copper. This is equivalent to 7 per cent of global annual demand in 2017. According to BHP Billiton's relevant data and analysis, in addition to copper, the first decade after the launch of the "Belt and Road Initiative" initiative (2013-2023) is expected to generate as much as 150 million tons of incremental steel demand. This is equivalent to 9 per cent of global annual demand in 2017.

[inventory]

Total inventory: the national total thread inventory 1111.2, down 611000 tons from last week, month-on-month ratio of-9.0 per cent. Compared with the same period last year, current inventories are down from 1.096 million tons in the same period last year, or-9.0 per cent year-on-year.

Social inventory: this week's thread database 866.6, down 47.1% from last week's 916.9, month-on-month ratio of-5.2%. Compared with the same period last year, it was 8.947 million tons, down 3.1 per cent from the same period last year. This week is the last week of March, most trading companies only open 13% of the tax bill, the demand side in order to earn most of the tax gap is concentrated in last week to pick up goods, this week's willingness to take goods is not strong, and this week's price differentiation is more serious. Most of the procurement side is in a wait-and-see state, and the decline in the social database is not as large as last week.

In-plant inventory: thread factory warehouse 244.6 this week, down 10.7% from 255.3 last week,-4.1% from the previous month, and 25.0% from the same period last year. In the sixth week after the festival, the decline of factory warehouse is no longer the main reason for the decline of total inventory, but the decline of social warehouse is slightly higher than that of factory warehouse. On the whole, by the value-added tax change disturbance, this week the market spot price is uneven, high and low differentiation. As the tax reform implementation date approaches, most companies only open 13% of the tax bill, there is no tax gap to promote downstream procurement, market transactions this week is more mediocre, the rate of warehouse decline is not as fast as the same period last year.

[macro and policy aspects]

Chinese Premier Li Keqiang said in a speech at the Boao Forum for Asia on the 28th that we must implement the measures promised to reduce taxes and fees on a larger scale. Tax reduction and fee reduction is a fair, inclusive, direct and effective reform measure, and it is an important measure to stimulate the vitality of the main body of the market and deal with the downward pressure of the economy this year. Tax cuts and social security contributions this year will reduce the burden on enterprises by nearly 2 trillion yuan. This is a great boon for businesses, but a great pressure on the government. We demand that governments at all levels themselves live a tight life, reduce general expenditure, invigorate the stock of assets and funds, and increase income and reduce expenditure mainly to support tax cuts and fees, in exchange for the improvement of enterprise efficiency and the enhancement of market vitality. We will find a new way to open up sources of revenue and save money and benefit the enterprises and the people.

2. The RMB exchange rate is expected to take the "middle route." the Federal Reserve pressed the "suspension key" to raise interest rates last week, and a new round of strong RMB cycle officially began. Analysts believe that this year, the operating environment of the RMB exchange rate is facing "one improvement" and "one positive," and the pressure on devaluation has been significantly alleviated, but the current international political and economic situation is complicated and the foreign exchange market is relatively uncertain. The trend of the US dollar is still unclear, the momentum of RMB exchange rate appreciation is insufficient, and there is little possibility of unilateral appreciation or depreciation this year.

3. The profits of iron and steel enterprises will gradually return to the rational range this year.

At the 10th China Iron and Steel Logistics Cooperation Forum held a few days ago, iron and steel industry experts said that the operating environment of China's iron and steel industry in 2019 is still complex and changeable. The slowdown in global economic growth is superimposed by trade frictions, making it difficult for steel exports to pick up sharply. The marginal effects of production capacity and environmental protection are decreasing. Stabilizing the effectiveness of supply-side reform, merger and reorganization, energy conservation and emission reduction will be effectively promoted, and the profits of iron and steel production enterprises will gradually return to the rational range. "

[summary of major events]

1. The General Office of the Ministry of Housing and Construction announced that the valuation of construction projects should be adjusted according to the value-added tax rate.

According to the official website of the Ministry of Housing and Urban-Rural Development on March 28, in accordance with the "notice of the General Administration of Customs of the Ministry of Taxation of the Ministry of Finance on deepening the Reform of value-added tax" (notice No. 39 of 2019) of the General Administration of Customs of the Administration of Taxation of the Ministry of Finance, The General Office of the Ministry of Housing and Urban and Rural Development announced that the valuation basis of the project cost stipulated in the notice of the General Office of the Ministry of Housing and Urban and Rural Development on adjusting the valuation rate of Construction projects according to the VAT tax rate (Construction Standard (2018) No. 20) will be added value. The tax rate was adjusted from 10% to 9%.

China's investment in fixed assets in highways and waterways increased by 5.8% from January to February 2019 compared with the same period last year.

In February 2019, China's fixed assets investment in highways and waterways totaled 75.782 billion yuan, an increase of 0.5 percent over the same period last year. From January to February 2019, China's fixed assets investment in highways and waterways totaled 204.01 billion yuan, an increase of 5.8 percent over the same period last year.

3. Songshan, Shaoguan Iron and Steel Co., Ltd. Announces 2018 Annual report

Songshan of Shaoguan Iron and Steel Co., Ltd. announced its 2018 annual report, with operating income of 27.1 billion yuan, an increase of 7.95 percent over the same period last year, and a net profit of 3.3 billion yuan, an increase of 28 percent over the same period last year. In 2018, the company produced 5.77 million tons of iron, down 8.37 percent from the same period last year; 6.61 million tons of steel, 3.89 percent less than the same period last year, 6.18 million tons of steel, 2.46 percent less than the same period last year, and 2.6 million tons of coke, down 7.15 percent from the same period last year.

4. Jiyuan 20 billion layout iron and steel deep processing

Jiyuan City plans to invest 20 billion to build the "Steel products Deep processing Industrial Park" in the further promotion. Jiyuan will make every effort to build a comprehensive steel product deep processing industrial park integrating production, processing and trade, and build a national first-class steel product deep processing industrial base and high-end equipment manufacturing base.