Investment suggestion: continue to be optimistic about steel stocks in the medium term. Against the backdrop of historically high profits and historically low valuations, the possibility of carbon neutralization has brought the ceiling of industry supply. In addition, the raw material side has contributed cost dividends again, and steel stocks will usher in a wave of sector opportunities for double rise in performance and valuation. Optimistic about the low value of high dividend ordinary steel, raw materials and some special steel. The first is Fangda Special Steel Technology Co.Ltd(600507) , Xinyu Iron & Steel Co.Ltd(600782) , Hunan Valin Steel Co.Ltd(000932) , Baoshan Iron & Steel Co.Ltd(600019) , Zhejiang Jiuli Hi-Tech Metals Co.Ltd(002318) , Citic Pacific Special Steel Group Co.Ltd(000708) , etc; Pay attention to Sansteel Minguang Co.Ltd.Fujian(002110) , Xinjiang Ba Yi Iron & Steel Co.Ltd(600581) , Inner Mongolia Eerduosi Resources Co.Ltd(600295) , Hbis Resources Co.Ltd(000923) , etc.
Industry view: the improvement of overseas demand drives steel prices. The shortage of steel supply caused by the conflict between Russia and Ukraine began to appear, overseas steel mills such as ArcelorMittal began to reduce production, there was a gap in the Middle East, CIS and other countries, and steel prices rose sharply. Last week, some Chinese varieties such as hot coil and billet followed the rise in prices. We expect that the positive impact of the conflict between Russia and Ukraine on China's steel prices will last for at least one quarter. With the intensification of the epidemic in China, the commencement of the project may be delayed, but the peak demand season will only be delayed and will not disappear. After the epidemic is alleviated, the steel price will usher in a wave of significant rise. After preliminary adjustment, the allocation value of steel stocks in the current position gradually appears. It is recommended to allocate high-quality steel enterprises with high dividends and low valuation, and Fangda Special Steel Technology Co.Ltd(600507) , Xinyu Iron & Steel Co.Ltd(600782) , Baoshan Iron & Steel Co.Ltd(600019) , Hunan Valin Steel Co.Ltd(000932) ; It is suggested to pay attention to Sansteel Minguang Co.Ltd.Fujian(002110) etc.
Market review: last week (March 13 - March 18, the same below), Shenwan iron and steel fell 4.6%, 2.9% behind the Shanghai Composite Index. The top gainers were Fushun Special Steel Co.Ltd(600399) (3.4%), Henan Hengxing Science & Technology Co.Ltd(002132) (2.4%), Jiangsu Changbao Steeltube Co.Ltd(002478) (2.1%). Last week, the prices of main contracts of screw thread, hot coil, iron ore and coke futures changed by 1.2%, 0.4%, 3.2% and - 0.9% respectively compared with the previous week (March 6-march 11, the same below); The profits of thread and hot-rolled sector changed by 2.4% and - 1.5% respectively compared with the previous week.
Industry trends:
General steel: last week, the social inventory of steel was 17.6 million tons, an increase of 0.1% month on month; Among them, the long timber inventory was 12.1 million tons, a month on month decrease of 2.1%; The sector inventory was 5.13 million tons, a month on month decrease of 2.0%. In early March, the average inventory of steel mills was 16.68 million tons, an increase of 3.6% month on month. Last week, the shipment volume of 237 steel traders nationwide was 170000 tons, a month on month decrease of 12.7%; Last week, the cargo volume of terminal line snails in Shanghai was 15000 tons, a month on month decrease of - 10.5%. The cost lag gross profit of thread, hot rolling, cold rolling and medium and heavy sector tracked are 923, 1049, 820 and 983 yuan / ton respectively.
Overseas steel price: last week, China's steel price composite index was 184.37, a month on month decrease of 0.3%.
Iron ore: last week, the shipment volume of iron ore from Australia, Pakistan and India was 20.68 million tons, a month on month decrease of 1.5%; The arrival volume of 6 ports in the North was 9.95 million tons, a month on month decrease of 24.0%. Last week, the iron ore port inventory was 154.97 million tons, a month on month decrease of 1.4%. Last week, the average daily dredging volume of Port imported mines was 2.8664 million tons, an increase of 3.8% month on month.
Coking coal and coke: the spot price of coking coal is high, the fear of heights in the market is obvious, and the purchasing enthusiasm of downstream coking plants is low, so they mostly maintain the state of purchasing on demand. Coking coal market fluctuates at a high level, and the market is mainly on the sidelines.
Ferroalloy: last week, the upward rush of silicon and manganese was blocked, but the support below was still strong, the market mentality changed slightly, and the cautious atmosphere increased. The spot price of ferrosilicon is still stable. If the futures disk rises or falls sharply, it may also drive the fluctuation of spot price.
Special steel: last week, the price of the national excellent special steel market was weak, the price of steel mills was adjusted, and the price of steel mills rose and fell. In the market, affected by the epidemic, the transportation in many places was blocked, some markets were suspended, the demand was weak, and the market turnover decreased, but the short-term price support was strong. We expect the national premium steel market price to fluctuate in a narrow range next week.
Stainless steel: due to the large price difference between the internal and external market last week, Shanghai nickel rose sharply, and stainless steel futures also rose with Shanghai nickel. Houlun nickel fell by the limit for many times at the opening, which affected the internal market to fall.
Risk tip: real estate decline; The recovery of manufacturing industry was less than expected.
