SMM6 20 month news: for the second quarter of this year, if asked, what kind of metal is the hot spot of investment? A thousand investors may have a thousand answers of their own, but who is the craziest in the second quarter? It's iron ore. Since the end of April this year, the "Crazy Stone" has made great strides all the way, although there was such a brief pullback in early June, but then immediately broke through all the averages with several Changyang lines and embarked on a sky-breaking journey.
As of 10:00 on June 20, the main price of iron ore closed at 820 yuan per ton, up nearly 2.5 percent, up 201.5 yuan, or 32.6 percent, from the end of April (closing price of 618.5 yuan per ton on April 26).
SMM believes that driven by fundamental and macro resonance, iron ore continues to soar, the main contract I1909 touched 820, breaking the new high in nearly five years. The continued sharp decline in iron ore port stocks and the current high demand from steel mills are the main reasons why the current iron ore market continues to hit new highs.
SMM data show that a total of 90 ships arrived at China's major ports from 6.9 to 6.15, and the arrival volume is expected to be 12.44 million tons, an increase of 1.17 million tons over the previous period, and the increase in the number of ships arriving at the main ports in East China is more obvious. During the period, exports from Australia are expected to increase by 600000 tons to 15.14 million tons, while those from Brazil are expected to fall by 1.41 million tons to 4.82 million tons. Although the recent increase in the number of ships, it is still difficult to alleviate the current shortage of mainstream varieties.
A businessman in Tangshan area said that the current port inventory is dominated by steel mill resources, and the proportion of tradable mines continues to decline; in order to ensure normal production, steel mill resources are kept for their own use. But the trader cherishes the sale to wait for the rising sentiment is strong, drives the spot price to rise unceasingly to expand.
On the iron ore side, recent shipments and arrival have rebounded, with a slight improvement on the supply side and a gradual slowdown in the pace of destocking; Brazil's Vale official said its Brucutu mining area had passed court arbitration and that the remaining 20 million tons of wet production capacity would resume within 72 hours; at the same time, Rio Tinto said it would lower its annual shipping target of about 13 million tons due to certain factors. In terms of demand, steel mills began to show signs of production reduction, but inventory is still low to maintain production still need rigid procurement, marginal decline in demand but limited; iron ore gap exists for a long time, but the recent production reduction in steel mills has an impact on demand, the rise is expected to slow down.
Rio Tinto issued a statement to adjust Pilbala's target shipment of iron ore in 2019 to 3.2-330 million tons from the previous 3.33-343 million tons. Rio Tinto is currently facing challenges in production at the Pilbala Greater Brockman mine. Because of the high proportion of low-quality iron ore in the mining area, the target shipment volume is reduced to a certain extent to ensure the quality of Pilbala mixed iron ore (PB). In addition, the VALE website said that the local Supreme Court through its Brucutu mining area resumption request, Brucutu mining area remaining 20 million tons of wet separation capacity may resume production in 72 hours. VALE reconfirmed its 2019 iron ore sales target (including pellets) of 3.07-332 million tons, unchanged from the previous official release, but now expects sales to rise from below the midpoint of the original range to the midpoint.
Chinese President Xi Jinping made an ordinary telephone call with US President Trang on the 18th. Trump said he is looking forward to meeting with President Xi Jinping again on the sidelines of the G20 leaders' summit in Osaka, hoping to discuss issues of common concern. The call released a positive signal that the market had reversed its pessimistic expectations for the macro, with iron ore rising 5.08% to close at 806.5 points. From the stock point of view, the stock and factory warehouse have increased, indicating that the inflection point of wood consumption has arrived, and the recent tightening of production restriction policy, some steel enterprises in Tangshan have been interviewed, and some steel enterprises that have not been interviewed have also taken the initiative to shut down some sintering equipment, and the demand for iron ore may decline slightly in the short term. Iron ore fundamentals are still good, but need to pay attention to the impact of falling demand, cautious bullish, how many orders can continue to hold, callback to choose the opportunity to buy.
Spot picked up slightly, building materials transactions fell back. Looking for steel mesh data show that in the case of tightening of production restrictions, maintenance increases, steel production has declined, off-season inventory has accumulated smoothly; profits have fallen continuously, future maintenance expectations have been strengthened, superimposed raw material end support is stronger, steel prices are expected to be dominated by wide shocks in the short term. Spot prices rose sharply and trading volume remained high. On the supply side, the resumption of Brucutu production accelerated again, depressing market sentiment. However, the resumption of production to the product is reflected in the domestic port for a long time, which is expected to have little impact on the 09 contract, while the blast furnace start-up of the steel plant on the demand side is still relatively stable, the demand for iron ore remains high in the short term, and the spot continues to destock. The price of high base difference support period is on the strong side.
The continuous and rapid decline of port inventory is the best embodiment of the contradiction between supply and demand. In the past two months, port inventory has declined at an average rate of more than 2.6 million tons per week, traders' inventory continues to shrink, spot is easy to rise and fall, and the contradiction between supply and demand intensifies with the continuous decline of inventory. Iron ore main 1909 contract continues the previous strong pattern, continues to hit a new high, as of June 19, the highest intraday closing 812.0 yuan / ton. We believe that the increasing contradiction between supply and demand of iron ore is the fundamental reason for the continuous rise of iron ore. In May, the shipping volume of foreign mines maintained a neutral low level, especially the VALE shipment was significantly lower than in the same period of previous years; the continuous decline in profits did not have a substantial impact on the production of steel mills, the operating rate of steel mills remained high, and the demand for iron ore remained relatively exuberant. The continuous and rapid decline of port inventory is the best embodiment of the contradiction between supply and demand. In the past two months, port inventory has declined at an average rate of more than 2.6 million tons per week, traders' inventory continues to shrink, spot is easy to rise and fall, and the contradiction between supply and demand intensifies with the continuous decline of inventory. If the port inventory can not effectively stop the decline and stabilize, the strong pattern of iron ore will continue. (reported on 20 June)
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