Rolling companies are in production halt and sluggish demand for billets

After the billet resumed its quotation, it fell 300 yuan / ton on the first day. Is this somewhat unexpected? Mysteel billet analyst Zheng Hongwen said that in fact, although the former Tangshan steel mills did not offer prices for the time being, the steel mills directly sent the actual price to about 3080 yuan / ton,
On the 17th, the ex-factory price of steel mills in Changli area was 3,000 yuan / ton (cash included tax).
However, it is worth noting that the average gross profit of steel mills is already very low, and the pressure to reduce production in the later period will further increase. Mysteel surveyed that the utilization rate of blast furnace capacity on February 14 was 72.94%, a decrease of 6.52% from the previous week, a rapid decline and a significant decrease.
 
On the demand side, 96 billet rolling mills in Tangshan area consumed an average daily steel billet of 10,200 tons last week, a decrease of 25 thousand tons compared with last week. Steel rolling companies are still in production suspension and sluggish demand for billets. There is currently no clear start date.
 
The short-term mismatch between supply and demand and the unimprovable objective conditions also lead to the fate of steel billets and finished products is very similar-the accumulation of stock is fast. Last week Tangshan's main warehouses and ports' same-caliber steel billet inventory was 696,600 tons, an increase of 147,400 tons from the previous week.
 
Continue to maintain the state of shutdown, warehousing inventory continues to accumulate, this week accumulated over 800,000 tons of storage has no suspense. Last week, 45.58 tons of slab inventory was investigated in 33 downstream steel rolling sample plants, an increase of 92,000 tons from the previous week.
 
Source: Steel Union data
 
Downstream manufacturers' billet inventory is also high. The direct sales ratio of steel mills has increased significantly compared to last year, and some trade bills have been issued after the holiday. At present, the export of billets is relatively stable, but sales and transportation are under pressure. In addition, the high inventory corresponding to the occupation of funds is too large, the repayment
The unsatisfactory situation and the relatively obvious pressure of the steel mill agreement will also restrict the billet price, and the billet price will continue to be under pressure. ( source from mysteel.com)
 

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