2021q4 steel sector fell, and the trend of ordinary steel and special steel was divided. In 2021q4, the downward pressure on the economy appeared, and the steel price weakened. Among them, the average price of Q4 thread steel fell by 5.40% month on month, and the average price of Q4 hot rolling fell by 11.90% month on month. The superposition of environmental protection and production restriction had a certain impact on the output of steel enterprises. The market was worried that the profits of steel enterprises would be damaged, which dragged down the performance of the steel sector. SW steel fell 6.05% in the single quarter of 2021q4, ranking the penultimate in Shenwan industry. In terms of segmentation, the trend differentiation between ordinary steel and special steel is obvious. 21q4 ordinary steel sub sector fell by 15.36%, and 21q4 special steel sub sector rose by 11.39%.
The proportion of fund positions in the steel sector declined. From the perspective of institutional positions: 2021q4 fund reduced its holdings of steel stocks, and the allocation proportion of steel sector decreased by 0.05pct to 0.75% month on month. Since 2020q4, with the promotion of “double carbon” and other policies, the focus of steel price is upward, the expectation of steel profit improvement is strong, and the proportion of steel allocation by the fund has gradually increased, from 0.15% in 2020q3 to 0.80% in 2021q3. However, with the decline of steel price in 2021q4, the profit expectation of the steel sector became worse, and the allocation proportion of the fund to the steel sector declined.
Investment suggestion: be optimistic about the opportunities of special steel and pipe materials.
1) looking forward to 2022, the demand side will build a stable growth + double carbon limit steel output, and the profitability of the steel sector is expected to improve. The central bank cut interest rates and gradually promoted various measures to stabilize the growth of infrastructure to support the demand for steel. Under the background of “double carbon” at the supply side, the release of steel output is limited. The iron ore port inventory at the raw material end continues to be high, the coal output is gradually released under the stimulation of policies, the raw material price probability is weaker than that of finished products, and the profit of the steel sector is expected to improve.
2) ordinary steel sector: capital construction has increased steadily and the target of pipes has benefited. The steady growth policy of infrastructure construction is gradually promoted, the improvement expectation of steel demand is strong, the integration of steel industry is gradually deepened, and the competition pattern of steel industry is further improved. It is suggested to pay attention to Baoshan Iron & Steel Co.Ltd(600019) of the leading target of general steel. In addition, the construction of underground pipe network will be one of the important driving points of infrastructure investment in 2022, and the orders of pipe network are expected to pick up significantly. It is suggested to pay attention to the pipe network targets Tianjin You Fa Steel Pipe Group Stock Co.Ltd(601686) , Xinxing Ductile Iron Pipes Co.Ltd(000778) with certain growth attributes.
3) special steel sector: demand is good + production capacity is released, or it will drive the accelerated release of performance. Benefiting from the development of downstream aerospace, marine engineering and other fields, the consumption of special steel is improving, and the projects under construction of some special steel enterprises are put into operation in an orderly manner, which may drive the accelerated release of performance. It is recommended to pay attention to Zhejiang Yongjin Metal Technology Co.Ltd(603995) , Fushun Special Steel Co.Ltd(600399) and other subjects.
4) graphite electrode: “double carbon” opens up the demand space, the new capacity is limited, and the industry inflection point appears. The carbon emission of electric furnace steelmaking is far lower than that of blast furnace steelmaking. The policy encourages the development of electric furnace steelmaking. At the end of the 14th five year plan, the proportion of electric furnace steel in crude steel output is expected to reach 20%, opening up the demand space for graphite electrode. Graphite electrode itself is a high energy consuming industry. Some provinces and cities have issued policies to restrict the approval of new production capacity. The inflection point of the industry is expected to gradually appear, and the price focus of graphite electrode may rise for a long time. It is recommended to pay attention to the graphite electrode faucet Fangda Carbon New Material Co.Ltd(600516) .
Risk tip: the demand for real estate steel has fallen precipitously; Steel prices fell sharply; The price of raw materials fluctuated sharply.
