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Jiangnan Rain Jersey Building, but the demand is sonorous.
Jul 7,2020 18:13CST
translation
Source:SMM
The content below was translated by Tencent automatically for reference.

(7 July)

< 1 > in terms of epidemic situation.

Domestic epidemic situation: confirmed / imported cases / asymptomatic / critical count death / 526Universe 1942 Universe 114Universe 4648.

 

Beijing: as of 15:00 on July 5, there was only one high-risk area, 22 medium-risk areas and 24 low-risk areas in Beijing.

 

Overseas epidemic situation: new cases / confirmed cumulative cases / deaths / 17pr 1784 / > 11.6637 million / 53pr 6207.

 

Us Empire priority: new / confirmed cumulative cases / deaths / 47440 / > 3.041 million / 13pr 2981.

 

Serious countries and regions.

2. Brazil: > 1.626 million / 26209Universe 6 minute 5556.

3. India: > 721300 / 25160 Universe 20184.

4. Russia: > 687800 / 6611 Compact 10296.

5. UK: > 285700 / 0ram 4jue 4236.

5. South Africa: > 205700 / 8773 Universe 3310.

6. Peru: > 305700 / 3638amp 10772.

7. Mexico: > 261700 / 4683 Compact 3pm 1119.

8. Chile: > 298500 / 0 / 6384.

9. Iran: > 243000 / 2613 Compact 11731.

10. Baccartan: > 234500 / 3344amp 4839.

11. Saudi Arabia: > 213700 / 4207Universe 1968.

13. Bangladesh: > 165600 / 3201Comp2096.

14. Columbia: > 120200 / 3721 Universe 4210.

15. Argentina: > 77800 / 2439amp 1582.

 

< 2 > Today's current playback

1. The overall rebound in the spot market price of steel continued, with an increase of 10 to 50 yuan per ton. Guangzhou in South China was the top gainer, rising 30 to 40 yuan per ton, while in the East China market, Shanghai rose 20 yuan per ton and Hangzhou rose 10 yuan per ton.

Transaction situation: the demand for beauty is sonorous and forceful.

Market mentality: active host.

Tangshan billet uplink 20 to 3350 yuan / ton, a new high rebounded this year.

Raw material end:

The market price of scrap steel remains stable today, and rain affects the supply.

The price of coke is generally stable.

The price of main coking coal is generally stable.

The spot market price of iron ore port rose 10-15 yuan / ton as a whole.

For details, see SMM Nonferrous net [Daily Review of Iron Ore Market]:

With the strong operation of Liantie today, the price in the port spot market has been raised by 10 Mel 15 yuan / ton in early trading. Today, the mentality of traders is better, the quotation is more positive, but the willingness to raise the price is also strong; individual steel mills purchase on demand, most of them are still more cautious about the price increase and continue to wait and see. The turnover of PB powder in Shandong area was 780 RMB785 / ton, while that of PB powder in Tangshan area was 795 RMB805 / ton, up 10 yuan / ton compared with yesterday.

2. Futures:

RB2010 main contract: shock uplink between 3618 and 3654 within the day, closing at 3634.

HC2010 main contract: shock uplink between 3604 and 3642 within the day, closing at 3629.

 

Iron ore i2009 main contract:

In the past, there was no room for boasting, but now there is no limit to debauchery!

It rebounded strongly between 749 and 773.5 in the day, closing at 767.

 

Coke J2009 main contract: within the day between 1863.5 to 1885 strong shock, closing 1877.5.

Coking coal JM2009 main contract: within the day between 1185 to 1197 narrow horizontal concussion, closing 1186.5.

 

< 3 > Forecast for tomorrow:

1. Spot: strong operation is the main continuation.

2. Futures:

RB2010 main contract: concussion between 3600 and 3680.

HC2010 main contract: concussion between 3590 and 3670.

I2009 main contract: concussion between 750 and 790.

J2009 main contract: concussion between 1860 and 1930.

JM2009 main contract: concussion between 1160 and 1200.

3. Spot operation tips: the implementation of the author's recommendations, the low part of the appropriate amount of replenishment of inventory will continue to profit-taking.

4. Futures operation suggestion

Thread, hot coil: the main rolling operation is to maintain high throwing and low suction in the range.

Iron ore: the rolling operation of high selling and low suction is the main operation in the range, and the single drop is less than 750 stop loss.

Coke: the rolling operation of high selling and low suction is the main operation in the range of activists, the multi-order effectively falls below 1860 stop-loss, and the empty single effectively breaks through 1930 stop-loss.

Coking coal: wait and see.

RB2010 main contract: pressure level 3680.

HC2010 main contract: pressure level 3670.

I2009 main contract: pressure position 685.

J2009 main contract: support level 1870, pressure level 1900, 1930.

JM2005 main contract: support level 1160, pressure level 1200.

 

< 4 > Information and heart words.

1. A few days ago, the Ministry of Finance has issued a new batch of new local special debt lines to the provincial financial departments. In addition, the 200 billion quota to replenish the capital of small and medium-sized banks has not yet been issued, and each province needs to fight for it separately with specific programs. In late May, the National people's Congress approved a new local government special debt limit of 3.75 trillion in 2020. After deducting the quota of 2.29 trillion issued in advance and the quota of 200 billion to replenish the capital of small and medium-sized banks, the quota issued this time is 1.26 trillion.

 

2. [the scope of 50% increase and reduction of coke in the first round is expanded. Hebei, Shandong and other places follow up] the spot market of coke is running steadily and weakly, and the scope of 50% increase and reduction in the first round is expanded. The coke of steel enterprises in Tangshan, Qinhuangdao, Shandong and other places will be reduced by 50 yuan / ton from 00:00 on the 7th. The specific price adjustments are as follows:

Some local steel enterprises in Tangshan will reduce coke by 50 yuan / ton, which will be implemented at 00:00 on the 7th, while others have a strong intention to reduce coke. Now Tangshan local mainstream market quasi-first-class coke A13 S0.7 CSR60 mur63 reported 1990 Mur20, all to the factory acceptance, including tax price.

The coke of some local steel mills in Qinhuangdao will be reduced by 50 yuan / ton, which will be implemented at 00:00 on the 7th. After the reduction, the secondary coke will be quoted at 1850 yuan / ton for acceptance, and the quasi-primary coke will be quoted at 1920 yuan / ton for acceptance.

On the 7th, the price of metallurgical coke in Linyi area of Shandong Province was reduced by 50 yuan / ton, and now the secondary wet quenching A13.5 S0.8 factory, including tax, is 1890 yuan / ton.

 

3. SMM tracking data show that from June 28 to 7.4, a total of 93 ships arrived at eight major ports in China, and the incoming cargo volume is expected to be 15.79 million tons, a decrease of 400000 tons compared with the previous period and an increase of 1.95 million tons over the same period last year. The number of arrivals to Hong Kong in Tangshan continued to increase slightly compared with the previous period, while that in Shandong decreased greatly. During the period, Australia's port departure decreased by 860000 tons from the previous month to 17.56 million tons, but increased by 5.52 million tons over the same period last year, an increase of nearly 46%. In this period, the proportion of Australian shipments to China decreased from the previous period. Brazil's current period of departure fell by 970000 tons from the previous month to 6.9 million tons, an increase of 830000 tons over the same period last year. The short-term double drop in the transportation of Aoba Iron Mine and the actual impact of superimposed production restrictions in Tangshan remain to be observed, all of which provide some support to the current market in the iron ore period. [SMM Steel]

 

4. Strong expectations are continuously strengthened, while weak reality is passivated.

In the early stage of weak realization of steel, the original sin is the rain in the south of the Yangtze River and the epidemic situation in Beijing. On this point, Tong knows that, so many fence riders in the market conclude that demand has peaked and the inflection point of steel prices has entered a downward cycle. No, no. The difficulty in judging the law of market operation lies in late deductive reasoning. The author has prospectively deduced (February tweet) that the value depression of Chinese stocks has become obvious, and there are epic investment opportunities. The recent performance of the stock market has or will continue to fulfill the author's point of view. Black line to this day, the market long and empty differences are still the same. The logic of the bears is simple: we can only see the rain in July superimposed high temperature weather and static inventory, static high production factors. The author looks at the steel price market in July, and the main logical thinking will not be repeated. There are only three points to be emphasized today:

First, the macro environment continues to improve, the currency is overissued, and commodity prices need to be revalued.

Second, the production limit of environmental protection in Tangshan area has become more and more stringent recently, and the author's forward-looking judgment is being fulfilled.

Third, although the rain in the south of the Yangtze River has a great disturbance to demand, the daily high-frequency trading volume index is really not bad! Just imagine what would happen to steel prices without the influence of the rainy season. The author is confident about the resilience of demand in the second half of the year, and worry is part of the replacement of new capacity in the fourth quarter.

After all, the impact of short-term rain is local and the overall situation is intact, which is, of course, the main driving force of regional differentiation in the near future. Steel traders in each region should combine this factor to distinguish the operation of the spot. For example, whether the impact of rain in Wuhan is coming to an end, if so, it will be an opportunity to replenish inventory at every bargain, otherwise wait. For example, in the early stage of the Guangzhou market in South China, the author suggests using the price drop in typhoon weather to replenish the inventory, and the low price range is just in this period of time.

 

In terms of iron ore

Today, a big positive line will return all the ruts after the Dragon Boat Festival. Why? The main reason is that there is no substantial change in the fundamentals of high demand, only because of the anxiety of capital sentiment. The so-called drop in the operating rate of blast furnace has no harm to the demand for iron ore, of course, the environmental protection production restriction in Tangshan area is stricter, which has an impact on the reduction of iron ore demand, which needs to be paid attention to. The hard core on the iron ore supply side is still an epidemic in Brazil, and the epidemic in Brazil continues to worsen. How credible can Vale's target task of 310 million-330 million tons be achieved?

 

Coke

Although the seventh round of rise has not yet landed, the first round of lifting and lowering of steel mills is under way. , but the coke enterprise did not reply. The fundamentals of coke are still healthy, and the overall supply and demand is still in a tight balance! It's just the result of the distortion of the steel mill. The future focal plane (1842) has shown four rounds of lifting and lowering, with a discount of 200 yuan / ton. Coke demand end is the same as iron ore, do not repeat; different iron ore on the supply side, coke enterprise profits are high, production is of course high, the problem is that the overall implementation of capacity is good! There is no pressure on the inventory of coke enterprises. Steel coke game intensified, take it easy! It is hard to stop profit and loss in time.

 

With Monday's heart words

Although rain affects the continuation of demand, the demand is very resilient, and once the rain disturbance is over, the return period of demand can be expected later; the production limit of environmental protection in Tangshan area becomes stricter, and the output reaches its peak stage with a high probability of falling down; due to the small base difference, it is necessary to catch up with the spot, and the probability of running into strong shock in the short term is high (the rut space is limited). With the improvement of the macro environment, the stock market rebounded to a new high this year, and the cyclical bull market was characterized by a strong support for the bottom of the black system. The seasonal impact on the limited demand for stone coke is gradually drifting away, focusing on more opportunities in the distant month; the epidemic in Brazil is likely to worsen in the fourth quarter, especially in iron ore long-month contracts. In short, the author's point of view remains unchanged, macro direction, basic plane dimension, general direction rebound is still walking on the road …. No, no.

 

The heart comments of the week are attached.

In terms of finished products

The gap between strong expectation and weak realization is strengthened. Today's futures steel rose sharply, the spot rose slightly, and the cash spread converged sharply. Take the three types of brands in Shanghai as an example, the spot price of futures is more than 30 yuan / ton, and in the case of Shanghai Shagang brand, the spot discount of futures is less than 80 yuan / ton. The original sin is that the spot is more focused on the static reality, that is, the short-term output is high, the rain in the south affects demand, and the superimposed market "fortune-telling" disturbance. Normally speaking, Fuzhou Steel is the deduction of expectations, that is, the dynamic changes of industry output, demand and inventory. From the main road to the middle: macro direction, industry dimension. Whether the truth is put aside for the time being, but after N times of practice, at least there is a good chance of winning.

The main factors affecting the operation of the market next week include, but are not limited to:

First, parts of the south continue to rain, the impact of high-temperature weather is unharmed (the author has said, I will not repeat it).

Second, the examination of life (July 7, 8 college entrance examination) will affect the construction, but it is very limited.

Third, how big is the actual "rainfall" of environmental protection production restrictions in Tangshan area.

Fourth, whether the macro environment continues to strengthen, the author tends to think that we should not dream too much in the short term.

Fifth, to what extent the output converges, we should pay attention to the hot coil varieties of rebar blast furnace hot metal.

The sixth is the intensity of demand recovery in the areas where the rain is different from the sunny day.

Seventh, the problem of funds affects the life of the construction.

 

Raw material side.

Scrap: with the decrease of the operating rate of independent electric arc furnace and the decrease of the proportion of scrap addition in long process, the production capacity converges in stages, and the scrap price is still under short-term pressure.

 

In terms of coke: the fundamentals are still healthy, and coke enterprises are highly motivated to produce (unlimited nonsense). ), but the core is the low inventory of coke enterprises. It is said that the market thinks that the seventh round rise has peaked and fell back (I do not agree). At present, we are considering the delivery routine "moisture" at least 150 yuan / ton coke discount, that is to say, the disk price has already reflected three rounds of increase and decline, looking forward to the replacement of new production capacity (referring to crude steel output), long and short risks and opportunities should be measured!

 

Iron ore: production restrictions on environmental protection in Tangshan area will of course have a negative impact on iron ore demand, the author believes that no matter how the impact will not hurt the overall situation, the overall situation of high demand is not only unharmed but also higher. The supply-side hard core is still the epidemic of mining countries exported to China, such as Brazil, India, Mexico, South Africa and so on. Short-term inventory fluctuations should not be too troublesome, containing too much "water". No, no. In short, iron ore short-term recovery space is very limited, hope more empty and go and cherish.

In short, the author's point of view remains unchanged: the general rebound is still on the way. No, no. There are only many battles on the road to rebound.

Market outlook for July: for details, see the monthly Review of June 25.

 

 

 

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