Steel market condition: Although the steel demand of downstream weakens gradually, the supply market still has great pressures. The supply and demand of steel are imbalanced.
On 23rd November, Shanxi Coking Coal Group made a medium and long term contract about the 2017 coking coal in Bejing with 6 major steel and iron groups. Including Hebei Iron and Steel Group, Shougang Group, Anshan Iron and Steel Group, Bao Steel Group and Valin Steel Group. And it shows that the government hopes to stabilize the price on policy level.
Actually, in December, the steel market condition will still face a great pressure. Internationally, some risky events shock the global market, such as the rise of the Fed’s interests rates and Italy’s referendum. Domestically, the weather turns cold and the construction sites will set idle at the end of the year. Therefore, the demand of the building materials, including RB and glass, will enter the off-season. And the price of some commodities will be lower. Currently, some steel groups adjust the production to solve this problem.
It forecasts that the supply of steel will be cut to attract the speculative money. And in the short term, both the market mentality and the support of steel’s cost are very well, and the price of steel will continue to grow. But, the weak demand of steel in winter, together with the growth of steel stock, will not support the price to grow. So, be cautious of the high-risk.
