1. Galvanized sheet price run "steady and rising" in January
After a slight decline in the domestic galvanized market in mid-November, it began to rise steadily. Until 2020, there was no obvious decline. Mainly due to the strong support of the market price of raw materials, increasing market shortages and prolonged downstream replenishment demand.
According to the price monitoring of SunSirs, as of January 31, the average market price of hot-dip galvanized coils for sea 1.0 * 1250 * C was 4,676 yuan / ton, up 0.43% from the beginning of January and up 7.35% year-on-year.
From the comparison chart of the hot rolled coils and galvanized sheet price trends of the SunSirs, since November, they have basically been in a synchronous rising market. The hot rolled coil’s trend is significantly higher than that of galvanized sheet. On the one hand, it is due to the hot rolled coil as a raw material. Its own uses and market applications are relatively wide, and its financial attributes are also large. In addition, steel mills continue to raise prices, so its rise is high. Looking at the galvanized market, first of all, its raw material prices are firmly supported, and its prices have an upward momentum. Secondly, although the market is out of stock, the overall arrival of the goods has slowed down the price increase caused by the shortage. Finally, its market demand is relatively Stable, there is no obvious new growth point in the whole, so the rise is not large.
On the supply side, data showed that, as of January 17, the 266 galvanized production lines across the country had 31 overhauls, an increase of 2 from the previous month. The operating rate of steel mills was 88.35%, which was a month-on-month increase of 0.38%. Capacity utilization rate was 62.59%, a month-on-month decrease of 2.85%. And the average weekly output of steel mills in the past month is about 776,600 tons, which is 23,100 tons less than the previous cycle, and has continued to decline for 4 cycles. It shows that since January, steel mills have continued to reduce production and market supply has contracted. Supporting price increases.
In terms of inventory, the data showed that as of January 17, the galvanized social inventory was 861,900 tons, which reached a new high in 2020; the steel plant inventory was 337,900 tons, which fell for 3 consecutive weeks, but has maintained 420,000 for 2 consecutive months Levels below the ton are also low for the year. Since the Spring Festival in 19 years, steel mill inventory has continued to decline, and gradually moved to social inventory, and terminal market pick-ups have gradually increased, and the role of traders' cisterns has decreased. In addition, at present, steel mills have a strong willingness to support prices, ex-factory prices have continued to rise, and the contract subsidy has remained unchanged, resulting in a weakened enthusiasm for traders to obtain goods and a weak willingness to ship. Overall, galvanizing prices are the main drag.
Therefore, from the point of view of the market before the Spring Festival, the galvanized market as a whole is firm and steady.
2. The resumption of work after the Spring Festival is delayed, the transaction slows down, and the price goes down.
Downstream terminal demand: Affected by factors such as the weak real estate market, the home appliance industry in 2019 is generally facing downward pressure on performance. Data show that in December China's refrigerator output was 6.902 million units, an increase of 21.9% year-on-year; from January to December, the cumulative output was 79.043 million units, an increase of 8.1% year-on-year. In December, China's air-conditioning output was 20.349 million units, a year-on-year increase of 10.9%; from January to December, the cumulative output was 21,866.2 million units, a year-on-year increase of 6.5%. China ’s output of washing machines in December was 7.265 million units, an increase of 9.7% year-on-year; cumulative output from January to December was 74.33 million units, an increase of 9.8% year-on-year. China ’s color TV output in December was 20.86 million units, a year-on-year increase of 0.7%; the cumulative output from January to December was 19,991,000 units, a year-on-year decrease of 2.9%. With the high level of home appliances, the overall demand for galvanization in the home appliance market in 2020 may continue to show a downturn.
Steel plant production: SunSirs have observed private galvanizing plants in most regions have planned production suspension during the Spring Festival, and affected by the "Spring Festival epidemic situation", the time for resumption of work is uncertain, and the overall impact on output is about 50,000 tons.
To sum up, the galvanized analysts of the SunSirs believe that the market situation of the domestic galvanized market was firm and stable before the Spring Festival, but the resumption of work after the Spring Festival will defiantly be delayed . In addition, the epidemic situation was strictly controlled across the country, which affected labor-intensive industries such as downstream galvanization Large, resulting in a slowdown in market success, and may be a drag on market prices. Therefore, it is expected that the price of galvanized sheet may be weak in the middle and late February. In early March, the overall steel market will recover, or there will be new price increases. The average market price is expected to be 4600-4700 yuan / ton.
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