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[Ferro-Alloys.com] From the perspective of demand, in June, the Southern region ushered in the rainy season, with rainstorms and floods in many places. At the same time, the Northern region experienced high-temperature baking, and the record of the highest temperature kept breaking. The situation of "rainstorm in the South and high temperature in the north" has a great impact on the national engineering construction, which directly affects the steel demand, especially the demand for construction steel such as screw steel and wire rod is significantly reduced.

 

In addition, the current situation of China's steel export is still grim. In May, China's steel exports reached 4.401 million tons, a year-on-year decrease of 1.339 million tons and a month on month decrease of 1.918 million tons. In the first five months of this year, China exported 25.02 million tons of steel products, a year-on-year decrease of 4.057 million tons. It can be seen that the strength of global "steel demand" is weakened, which has a great impact on China's steel exports.

 

From the perspective of supply, due to a wave of sharp rise in steel prices in May, the profitability of steel mills improved, the enthusiasm for production was high, and full capacity production was started one after another, resulting in the growth of steel production. According to statistics of CISA, in late May, the average daily output of crude steel of national key steel enterprises reached 2.0925 million tons, an increase of 12100 tons in ten days on a month on month basis, an increase of 0.58%; a year-on-year increase of 4.39%.

 

Above all, the market supply was ecpected to be "easy to increase and difficult to reduce" in the second half of the year, and the pressure of de stocking is still large.

 

Source: translated by editor