Tight supply and demand balance

In 2018, under the continuation of the main line of the supply-side reform policy, the national steel market maintained normal production and limited production, and the supply of crude steel remained tightly balanced throughout the year.

“Although the production restrictions on the blast furnace link, but the production enterprises to increase the proportion of scrap in the converter and the use of high-quality mines to achieve the purpose of increasing production, the output hit a record high, it is expected that 2018 crude steel production will reach a peak, close to 930 million tons, ' The increase in the portion of the floor steel after the clearing of the table has been increased, and the high profitability of the industry has brought positive production power to the production enterprises. The increase mainly comes from the converter electric furnace in the long process part and the short-circuit electric arc furnace part. "The Galaxy Futures Research pointed out.

Wang Fangjie, deputy secretary-general of the China Association of Scrap Steel Applications, said that in 2018, the country's crude steel output was about 930 million tons, of which the total scrap consumption was 187 million tons, and the scrap ratio was about 20%, which was further improved compared with the previous two years. It is estimated that by 2030, China's steel accumulation will further reach 13.2 billion tons, and scrap resource output will reach 3.2-350 million tons. “With China's steel accumulation, increased scrap resources and the advantage of scrap price, China's total scrap resources will be very abundant in the next 20 years.”

From the perspective of downstream demand, the actual consumption of crude steel in 2018 is 869 million tons, an increase of 11.08% compared with 2017. The overall market is still driven by the real estate industry. And from the second quarter, crude steel inventories fell to a low level and continued.

Looking back at the fundamentals of the 2018 steel market, Everbright Futures Qiu Yuecheng and Dai Mo said that the steel production capacity target for the 2018 steel market has been basically completed, and the steel industry investment growth rate has rebounded sharply. On the demand side, real estate investment and new construction growth rate are facing a decline. The short-term is expected to remain, but the growth of capital and debt will continue to constrain the growth of infrastructure investment. The boom in automobile, home appliance and shipbuilding industry will enter a downward cycle, and manufacturing investment will not rise significantly.

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