SMM News: yesterday, domestic commodity futures closed mixed, black varieties more strong, iron ore rose more than 3 per cent led the commodity market, hot roll, coke rose more than 1 per cent.
The reporter found that the top three varieties in the main commodity futures contracts yesterday were iron ore up 3.31 percent, crude oil up 3.05 percent, Shanghai nickel up 2.71 percent, the first three down 2.21 percent in Shanghai silver, 1.86 percent in Shanghai gold, and 0.88 percent in urea. The top three capital inflows were Shanghai silver 209 million, Shanghai nickel 147 million, PTA9664 million, and the first three outflows were coke 763 million, iron ore 523 million, and Shanghai gold 438 million.
Qiu Yuecheng, director of black research at Everbright Futures Research Institute, told reporters that black commodities have generally risen sharply since the end of August. The main reason is that the policy of going out of Taiwan at the macro level is positive, and the industrial level is also beginning to show some positive changes. At the macro level, fiscal and monetary policy have been continuously strengthened. In terms of fiscal policy, the State Council has asked the special bonds to ensure that the issuance of special bonds is completed by the end of September, all of them will be paid in place in October, and some new quotas for next year's special bonds will be issued in advance in accordance with the regulations, so as to ensure that they will be effective early next year. In monetary policy, the central bank announced a reduction in monetary policy, releasing liquidity of about 900 billion yuan, which will provide a strong boost to market confidence.
It is worth noting that there are many repairs and repairs in steel mills. Recently, the output of rebar has dropped for five consecutive weeks, from above 3.8 million tons in the previous period to below 3.4 million tons at present. With the steady release of demand, the decline in inventories has widened in the past two weeks, with total thread stocks falling sharply last week by 444300 to 8.35 million tons from a month earlier. And the recent Tangshan heating season production limit increase rumors continue, the market supply is still expected to shrink. And iron ore steel plant inventory low, with the improvement of profits to replenish the warehouse enthusiasm, the amount of sparse port has been rising in the past two weeks. "Australian mine terminal maintenance has a phased impact on shipping, the recent shipment and arrival volume have declined, the market PB, Newman, Jinbuba and other mainstream powder ore resources are scarce. These reasons have led to a recent rise in black commodity prices. " Qiu Yuecheng said.
It is reported that Iran intends to impose 25% export tariffs on iron ore exports. Iran's Financial Tribune reported on September 7 that Rachmani, minister of industry and mining trade, has submitted a proposal to impose 25% export tariffs on iron ore for parliamentary approval. If passed smoothly, the policy will take effect on September 23. Amiri, director of the Minerals Office, said the measure was aimed at preventing exports of raw mineral products, generating more value added and meeting domestic production needs. The policy is expected to reduce Iran's exports of raw iron ore (per year) to less than 5 million tons.
In the last fiscal year (March 2018-March 2019), Iran exported a total of 17 million tons of iron ore, worth $840 million, according to (IMIDRO), an Iranian mining development and innovation organization. In the five months to Aug. 22, iron ore exports reached 2.2 million tons, worth $542 million, at the beginning of the fiscal year.
Rachmani, minister of industry and mining trade, said that due to excessive iron ore exports, Iran's iron ore production has been unable to meet the demand of domestic steel companies, resulting in idle domestic capacity and unemployment. He encouraged increased investment in iron ore production to make up for the shortfall but stressed that the Iranian Government currently had no financial means available.
Iran is China's sixth largest supplier of iron ore, with exports to China accounting for about 91 percent of Iran's iron ore exports, the newspaper said. The Iranian government's plan to impose tariffs on iron ore exports will have an impact on the Iranian iron ore's foothold in the Chinese market.
Iron ore has strengthened continuously since the end of August, with 2001 contracts rebounding by more than 16 per cent from a low of 571.0 yuan per tonne.
Iron ore futures lead the black system, in the Guotai Junan Futures Industry Service Institute researcher Ma Liang, there are two reasons for the recent rebound is the recovery after the fall. The absolute price is too low, the lowest price of the previous 2005 contract is 526 yuan / ton, equivalent to US $62 / dry ton, there is a serious surplus of iron ore in 2017 and 2018, and the price performance is depressed. The average annual prices are US $71.32 / dry ton and US $69.46 / dry ton, respectively. Because of the mine accident in 2019, the large supply and demand pattern of iron ore has been tightly balanced, and it is difficult to return to the large surplus in 2017 and 2018 in a short period of time. So from this point of view, the early collapse led to the month of pricing is too low in the early period of iron ore decline is extremely smooth, more than a month down to 30%; On the other hand, the recent steel mills take the initiative to replenish the warehouse.
In fact, iron ore rose sharply in the first half of the year, and the inventory of the whole industrial chain continued to decline. Both steel mills and traders are reducing their inventories. Steel mills and port stocks have declined significantly. Port stocks have dropped from a minimum of 148 million tons to 115 million tons, and sinter stocks of steel mills have also dropped from 20 million tons to 15 million tons, which are significantly lower than in the same period last year. In particular, the inventory of steel mills has been compressed to a very low level, steel mills have been going to inventory in the first half of the year, on the one hand, the spot is really tight, procurement difficulties, on the other hand, the more important reason is that due to the continued sharp rise in iron ore prices, steel mills are extremely cautious about inventory, do not want to build inventory at a high level, purchase on demand at the same time in the compression of their own inventory. After the sharp fall in iron ore prices, steel mills will change their attitude towards inventory, and their willingness to replenish stocks will rise, especially in the run-up to the Mid-Autumn Festival and the National Day holiday, many steel mills with very low inventories will have to replenish their stocks.
"for the future, after iron ore bounces, the repair of overfall has been completed. Steel mills have started replenishment in September and are still in progress. It is expected that the replenishment of steel mills can continue to support mining prices to a certain extent, but the replenishment of steel mills is short-term driven. Sustainability is not strong, and the marginal drive to prices is gradually weakened. Recent rumors of winter production restrictions in Tangshan have aroused widespread concern in the market. Attention needs to be paid to assessing the impact of the production restriction policy on long-term iron ore demand. " Ma Liang said.
"with the continuous implementation of production restrictions in some blast furnaces, the daily consumption of some steel mills has decreased to varying degrees in the near future, and the inventory in the plant has continued to maintain a medium and high level of operation. At present, the rigid demand of steel mills has been suppressed and has continued to become stricter in the later stage. as a whole, some mainstream steel mills in the north continue to be cautious about coke procurement." Liu Yanjun, director of the Fen Wei Energy Price Center, told reporters that on the port side, affected by the rebound in the futures market, port prices rose slightly, and some quasi-first resources were quoted at 1860 yuan to 1900 yuan / ton, but there was basically no transaction after the increase, and the downstream market continued to wait and see that the market had no intention of receiving goods for the time being. On the whole, coke supply and demand is temporarily loose operation, the price is weak and stable. In terms of coking coal, the shipping pressure of coal mines in the producing area has not been reduced, affecting some of the mainstream, especially the original and clean coal stocks of coking coal mines, which are basically close to the highest level of the year. In the case of sufficient supply of coal sources and no obvious improvement in downstream demand, there is still a certain price reduction pressure in the coal mine. In terms of Mongolian coal, the customs clearance volume has remained high since September, but the overall downstream demand has been depressed, resulting in the appearance of shipping pressure on import trade enterprises, in which the port raw coal price has been reduced by 50 to 70 yuan per tonne. Tangshan clean coal terminal to the factory price of about 30 yuan / ton reduction.
Hao Xiangpeng, a black researcher at Galaxy Futures, pointed out that as of the afternoon of the 10th, the J2001 contract had reduced its position by 48200 to 1961 yuan per ton, and the JM2001 contract by 13326 to 1337.5 yuan per ton. On September 10, the overall price of coke in Inner Mongolia is weak and stable, Baotou-1670, Wuhai-1610, second-class S0.8 ex-factory settlement price is about 1510-1530 yuan / ton, Chifeng second-class S0.8 quoted 1780, the above are accepted including tax prices. After two rounds of price reduction, coke enterprises, steel mills profit redistribution, long process profit improvement, coke spot signs of stabilization, and do not rule out the peak season before the coke enterprises rose again.
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