Main points:
As of December 10, the Shanghai Composite Index rose 1.63% and the Shanghai and Shenzhen 300 index rose 3.14% this week. Steel sector rose 0.15%; Among the sub plates, the ordinary steel plate increased by 0.95%, and the special material plate decreased by 1.25%.
Steel market: the central bank lowered the deposit reserve ratio and superimposed the positive margin of real estate, resulting in the market rebound. The short-term fundamentals remain unchanged. We continue to pay attention to the special material plate that can get out of the growth market
This week, steel prices rose slightly and profits rebounded to a high point in the year. Spot prices of rebar, hot rolling and cold rolling rose by 0.21%, 0.41% and 1.82% respectively, and spot prices of medium plate remained at the level of last week. The performance of the steel market resumed this week. The steel price continued to rise, the price of double coke stabilized, the social inventory was accelerated, the profitability of the industry remained good, and the supply and demand fundamentals could support the steel price in the short term. Previously, the tightening policy of real estate financing was gradually corrected. With the recent reduction of bank deposit reserve ratio by the central bank, the real estate market may pick up at the end of the year, and the macro expectation will be gradually repaired. In terms of supply and demand, after the profits of the steel plant are repaired, the enthusiasm of the steel plant to resume production will be improved under the expected improvement of real estate demand. We believe that the recovery of demand this week is mainly due to the central bank's reduction of the deposit reserve ratio and the improvement of the margin of real estate. However, with the advent of winter, there is no real change in the short-term demand decline, and there is a greater opportunity for the special material sector.
In terms of special steel, stainless steel has good support for a long time, so it is recommended to continue to pay attention. The price of stainless steel fluctuated upward recently, the transaction continued to improve, and the market recovered. In the long run, with the support of the national carbon peak policy, the reduction of crude steel production has become a deterministic trend, which is important for the price and profit of stainless steel. It is recommended to continue to pay attention to Zhejiang Yongjin Metal Technology Co.Ltd(603995) , Fushun Special Steel Co.Ltd(600399) , Yongxing Special Materials Technology Co.Ltd(002756) and other targets. As the core metal material in the field of new energy vehicles, electrical steel is also a plate worthy of attention. Electrical steel is the motor and core material of new energy vehicles. Under the resonance of carbon neutralization at the policy end, accelerated admission of new and old car making forces at the supply end, and improved economy and convenience at the consumer end, new energy vehicles have developed rapidly, driving the downstream demand for electrical steel, The electrical steel plate has ushered in a major opportunity, but the valuation of Companies in the plate is generally not high. They are optimistic about the electrical steel plate for a long time. It is suggested to focus on Citic Pacific Special Steel Group Co.Ltd(000708) , Inner Mongolia Baotou Steel Union Co.Ltd(600010) , Xinyu Iron & Steel Co.Ltd(600782) , etc.
As of Friday, the price of rebar in the spot market was 4800.00 yuan / ton, with a weekly decline of 0.21%; The price of hot rolled coil is 4900.00 yuan / ton, with a weekly increase of 0.41%; The price of cold rolled coil was 5560.00 yuan / ton, with a weekly decrease of 0.36%; The price of medium plate was 5100.00 yuan / ton, with a weekly decrease of 0.39%. In the futures market, the active contract price of rebar was 4322.00 yuan / ton, with a weekly decrease of 1.41%; The active contract price of hot rolled coil was 4443.00 yuan / ton, with a weekly decrease of 3.33%; The active contract price of wire rod was 4773.00 yuan / ton, with a weekly decrease of 0.98%. The myspic composite steel price index was 178.59 points, with a weekly decline of 0.04%, of which the myspic long material index rose by 0.25% and the myspic flat plate index fell by 0.40%.
Raw material Market: the price of iron ore rose slightly, and the price of double coke remained low
Iron ore prices rose slightly this week, and the transaction prices of metallurgical coke and coke were flat, and generally stabilized. In terms of double focus, the seventh round of regulatory policies were implemented to effectively curb market speculation. With the effectiveness of various policies to increase production and ensure supply, the coal output has increased, the coal supply and demand pattern has improved, and the coke price is expected to fall further.
As of Friday, the price of Australian Pb powder in the spot market was 699.00 yuan / ton, with a weekly increase of 5.11%; The price of primary metallurgical coke is 2810.00 yuan / ton, stable and unchanged; The price of main coking coal is 1800 yuan / ton, stable and unchanged. In the futures market, the active contract price of iron ore was 639.50 yuan / ton, with a weekly increase of 4.41%; The active contract price of coke was 2911.00 yuan / ton, with a weekly increase of 2.25%; The active price of coking coal was 1934.50 yuan / ton, with a weekly decline of 2.59%.
Steel supply and demand: social warehouses continued to decline, building materials fell and plates rose
The steel output decreased this week, and the blast furnace operating rate decreased to 46.69%, which was lower than that of last week. In terms of output, the output of various varieties of steel showed a downward trend compared with last week: the output of cold rolling, hot rolling, wire rod and medium and heavy plate increased by 6.03%, 0.69%, 5.14% and 3.72% compared with last week, and the output of rebar decreased by 0.93% compared with last week. In terms of steel mill inventory this week, the inventory of cold rolling, hot rolling, building materials and rebar decreased by 0.9%, 1.54%, 19.15 and 23.81% respectively, and the inventory of medium and heavy plate increased by 0.9%. The market demand suppressed by high prices in the early stage may be released, and the market transaction will be improved. The approaching environmental protection pressure of 2022 Winter Olympic Games will lead to the contraction of supply in Beijing and Tianjin, driving the rebound of China's steel market.
Investment advice
With the recovery of manufacturing demand superimposed on the background of carbon peaking and carbon neutralization, the profit logic of the steel industry has been reconstructed, and steel enterprises have further benefited from the cyclical rotation. We are still optimistic about the steel sector for a long time. The national defense, military industry and aerospace industry have a broad domestic substitution space, and products such as superalloy, special stainless steel and ultra-high strength steel occupy an absolute dominant position. It is suggested to focus on the performance of the China Daily report and the special steel leader who can realize the high prospect of the industry: Fushun Special Steel Co.Ltd(600399) ; Leaders in traditional fields + hot emerging business targets are more favored by the market. It is suggested to focus on stainless steel rods and wires and mica lithium extraction leaders: Yongxing Special Materials Technology Co.Ltd(002756) ; And the high growth leader in the field of cold rolled stainless steel: Zhejiang Yongjin Metal Technology Co.Ltd(603995) .
Risk statement
Covid-19 epidemic situation is repeated; The economic downturn accelerated; The price of raw materials fluctuates greatly; The demand for real estate steel fell sharply; Steel destocking process is blocked.
