May 23 Steel Prices Fall

According to Mysteel statistics, in April, the world’s 64 steel-producing countries and regions produced 127 million tons of crude steel, a year-on-year increase of 5%. From January to April, the cumulative output was 500 million tons, an increase of 8% year-on-year. China's output was 59.03 million tons, an increase of 7.1% year-on-year.

On May 23, the domestic steel spot market remained weak. In the absence of current demand support, the forward price has become one of the important factors leading the market trend. On the 23rd, the domestic steel forward price continued to fluctuate, which made the spot market difficult to get better. Some parts of the domestic domestic market experienced collective arrivals in some markets over the weekend, which led to an increase in inventory pressure and the appearance of financial pressure. Some expect poorer businesses to continue to retaliate slightly, hoping to stimulate demand. On May 23, the Myspic Composite Index stood at 177.2 points, a decrease of 0.06% from the previous day.

On May 23, the flat product index was 154.3 points, down 0.13% from the previous trading day, of which the hot-rolled index and the medium-thickness index fell slightly, by 0.17% and 0.22% respectively. In the hot-rolling market, the Wuhan market and the Chongqing market have experienced relatively large declines. On the 23rd, the Wuhan hot-rolling market was slightly loosened, and the local market demand has continued to slump in the recent period, which has caused some restraint on the market operation. Last week, the local market price continued to fall, making low-level resource transactions significantly better than high-priced resources, this phenomenon makes local businesses to increase their willingness to allow shipping prices on the 23rd, the mainstream quotes are slightly loose. The hot-rolling market in Chongqing weakened on the 23rd. With the sluggish financial market trends at home and abroad and the continued decline in the forward price of steel products, the market mentality of the Chongqing market was once again weak, and the offer price also fell slightly. The transaction in the local market is still poor, but due to poor local arrival conditions, the market inventory is still at a relatively low level, so the market sales pressure is not great. For the later market, the increase in temperature, the impact of power cuts, and the expectation for future arrivals have made local businesses cautious, and it is expected that prices will continue to fall slightly in the later period. On May 23, the hot rolled 3.0mm of Wuhan market and Chongqing market fell by 50 yuan/ton and 20 yuan/ton respectively compared with the previous transaction fee.

In the plate market, the Shanghai market and the Shenyang market are weakly adjusted. On the 23rd, the market turnover in Shanghai remained weak, coupled with the weakness of forward prices, and the general lack of business confidence caused the local market resource prices to decline again. However, due to the unsatisfactory shipments, making the goods more cautious, so the current inventory is relatively small, the pressure is not. In general, the current Shanghai plate market maintains a status of “low sales, low prices, and low inventory” and it is expected that the pattern of weak shocks in the short term will not change. On the 23rd, the Shenyang plate market was slightly downgraded. Affected by the weak market consolidation in the surrounding markets, most businesses in the Shenyang market also slightly lowered their prices. There was a slight tentative pull up in the local market last week, but after the price rise, the market turnover did not give power, making the business mentality more pessimistic, and the willingness to cut prices and shipping has increased. For the later period, the market is generally expected to maintain the current pattern of weak shocks, and the short-term weakness is difficult to change. On May 23, the medium-thickness 20mm in Shanghai market and Shenyang market fell by 10 yuan/ton and 20 yuan/ton respectively compared with the previous trading day.

On May 23, the long products index was 200.6 points, which was the same as the previous trading day. On May 23, the price of steel products fluctuated, and the main seller of the screw fell by 0.93%. On May 23, the spot market of domestic long products was basically stable, and the market in some regions was slightly adjusted. The Chongqing wire market fell slightly, while the Xi'an thread market rose slightly. Chongqing's wire rod market fell slightly on the 23rd. Although Sha Steel and other steel mills raised their ex-factory prices again last weekend, the local market remained stable under the influence of weaker steel prices. The recent unsatisfactory transaction in the local market and the weak demand in the middle caused the continued shrinking of merchants' shipments. Therefore, under the influence of continued falling prices, the local merchants slightly retreated some of the wire prices in midday, and the market has a heavier wait-and-see atmosphere. On May 23, Xi'an long products market rose tentatively. Affected by the increase in factory prices of local leading steel mills, Xi'an market merchants tentatively raised their offers. At present, the transaction in the local market is still unsatisfactory, but the merchants believe that the slight adjustment of the price does not have much impact on the actual transaction. Therefore, the price is slightly raised in order to boost the market atmosphere. However, after the price rose, the market volume continued to shrink, and the market's low resources began to appear again. On May 23, the 6.5mm high market line in Chongqing dropped by RMB 10/t compared with the previous trading day, and the HRB335 20mm thread in Xi’an market increased by RMB 20/t compared with the previous trading day.

In terms of regions, the northwestern region index rose slightly by 0.17%, which was mainly driven by the tentative pull-up of Xi'an's long products market. The regional index rose relatively.