The resumption of steel plant production led to a decline in profits, focusing on the opportunities of subdivided sectors
After a continuous rebound in the early stage, steel prices fell slightly this week. The decline in steel prices was mainly due to the resumption of production by steel mills. Mysteel data showed that the output of the five varieties increased instead of decreasing, with an increase of 190000 tons in a single week. Since the second half of 2021, the key to the continuous improvement of steel plant profits lies in the rapid contraction of the supply side. However, under the background of steady growth, the marginal relaxation probability of steel supply in 2022 is too large (the Ministry of industry and information technology no longer emphasizes de production), and the possibility of sports production restriction in the past has been greatly reduced, which will lead to the decline of the profit center of steel enterprises compared with previous years. Therefore, we can see that driven by the logic of resumption of production, the price of raw materials is significantly stronger than that of finished products in the near future, and the profit per ton of rebar and coil plate has dropped by more than 200 yuan from the high level. Under the background of marginal relaxation at the midstream smelting end, the pattern of strong raw materials in the future is expected to continue (with greater upward elasticity or more resistance to decline under the downward trend), and the main benefit targets include Hbis Resources Co.Ltd(000923) , Inner Mongolia Dazhong Mining Co.Ltd(001203) . In addition, although the profit side of steel enterprises is unfavorable, the central economic work conference has set the tone for steady growth, and infrastructure has become an important starting point. It pays attention to the opportunities for sector valuation and repair in the subdivided field of rebar, mainly benefiting from Fangda Special Steel Technology Co.Ltd(600507) , Sgis Songshan Co.Ltd(000717) , etc. For the processing sector, we recommend continuing to focus on the layout opportunities of Lizhong Sitong Light Alloys Group Co.Ltd(300428) . Lizhong Sitong Light Alloys Group Co.Ltd(300428) as a representative enterprise in the field of aluminum die casting in China, the original aluminum alloy wheel, cast aluminum alloy and master alloy business shows a trend of rapid growth, and is expected to increase in volume and profit in the future. At the same time, the company has successfully developed high barrier material heat-free alloy, breaking the foreign technical monopoly. In the future, the company will benefit from the improvement of the penetration rate of integrated die casting, and its production capacity is expected to increase rapidly.
The ore price fluctuates at a low level, and the coke price is expected to run strong
(1) Iron ore: the iron ore inventory in port 45 this week was 156256500 tons, up 1130500 tons month on month. The global shipment of iron ore was 34.658 million tons, up 2.594 million tons on a weekly basis. Among them, 17.894 million tons were shipped from Australia, an increase of 848000 tons on a weekly basis; Brazil shipped 7.263 million tons, up 1.653 million tons on a weekly basis. At the same time, the molten iron output of 247 steel plants this week reached 20301 thousand tons, an increase of 40000 tons on a weekly basis. Previously, the rise of ore price was driven by the expectation of resumption of hot metal production, but the accumulated iron ore port inventory resumed this week. The game between fundamentals and resumption of production expectation was fierce, and the rise of ore price faced twists and turns in the short term. (2) Coke: some coke enterprises have strong upward momentum under the loss. The first round of increase this week has been accepted by some steel mills, and the short-term coke price is expected to be strong.
Plate key data tracking
Weak demand operation: this week (December 27-december 31), the average trading volume of national construction steel was 140600 tons, with a decrease of 123400 tons on a weekly basis. According to the calculation of Mysteel data, the apparent consumption of deformed steel bar was 2.677 million tons, with a decrease of 10.33% on a weekly basis; The apparent consumption of hot rolled coil was 3.057 million tons, with a week on month increase of 2.58%;
Supply continued to weaken: the national blast furnace operating rate (163) was 45.99% (the data was not updated this week); The capacity utilization rate of Tangshan steel plant was 54.94%, and the cycle to cycle ratio increased by 3.15 PCT. The national weekly output of the five varieties was 9.042 million tons, up 190500 tons month on month;
Profit fell slightly: this week (12.27-12.31), the gross profit per ton of rebar was 662 yuan, down 39 yuan month on month; The gross profit per ton of hot rolled plate was 575 yuan, down 50 yuan month on month; The gross profit per ton of cold rolled sheet was 460 yuan, down 9 yuan month on month; The gross profit per ton of medium and heavy plate was 583 yuan, up 21 yuan month on month.
Risk tip: terminal demand has fallen sharply, and the environmental protection production restriction policy is less than expected.
