Price trend

According to the price monitoring of SunSirs, the price of rebar and wire rod in Jiangsu, Zhejiang and Shanghai on July 23 decreased steadily compared to the 22nd, and was reduced by 10 RMB/ton from the market price on the 22nd. As of the 23rd, the average price of HRB400 rebar in Jiangsu, Zhejiang and Shanghai was about 3,620 RMB/ton, an increase of 1.49% or about 55 RMB/ton from last week, and a 3.05% increase or up about 105 RMB/ton from early July; the average price of HPB300 wire rod was about 3,760 RMB/ton, up 0.98% from last week or about 35 RMB/ton; compared with the beginning of July, it rose by 3.36% or up about 120 RMB/ton.

Analysis review

In terms of supply, as of the 23rd, the weekly production of rebar was 3,828,300 tons, a decrease of 1,300 tons from the previous month; the total inventory of rebar was 11.9732 million tons, a month-on-month increase of 251,900 tons, of which steel mill stocks were 3.4262 million tons, an increase of 120,100 tons from the previous month. , Social inventory was 8.547 million tons, an increase of 131,800 tons from the previous month. The weekly production of wire rods was 1.5651 million tons, an increase of 16,400 tons from the previous month, and the total inventory was 2.79 million tons, an increase of 55,600 tons from the previous month. Among them, the steel mill inventory was 773,000 tons, an increase of 67,800 tons. Social inventory was 2.0167 million tons, a month-on-month drop of 12,200 tons. In terms of demand, the apparent weekly demand for rebar was 3.5764 million tons, down 115,700 tons from the previous month; the apparent weekly consumption of wire rod was 1.5095 million tons, down 86,400 tons from the previous month.

The weekly output has not changed much from last week's overall, but the current blast furnace operating rate remains high, and due to the off-season, demand continues to decrease, steel mill inventories continue to shift to social inventories, total inventory continues to increase, and it is expected that later inventory will still exert greater pressure on market prices. Since July, as prices have rebounded, steel mills have maintained a high price attitude due to profitability. On the 23rd, most steel mills' ex-factory prices remained stable, and a small number of steel mills raised their ex-factory prices for rebar and wire rod by 10 to 30 RMB/ton. In terms of billet, some plain carbon billets in Tangshan area have increased by 20 RMB/ton this week, and the ex-factory price including tax is reported at 3,420 RMB/ton. In terms of futures, the rebar oscillated on the 23rd and ended with an increase in the evening. The main rebar 2010 contract finally closed at 3806 RMB/ton, an increase of 17 RMB/ton from the settlement price of the previous working day. Due to the strong operation of the futures market and the upstream black system earlier this week, the prices of wire rod and rebar have continued to rise, and the rising prices have led to strong downstream wait-and-see sentiment. The overall sales performance on the 23rd was average.

Market outlook

The price increase of wire rod and rebar market this week is mostly affected by the positive futures market and macro expectations. However, the high temperature is about to usher in, the steel demand does not have the conditions for a large release, and the high inventory also puts pressure on the market. Once the subsequent demand actually following up is insufficient, the price rise may slow down, and it is expected to fluctuate at a high level.

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