In the month of September, China's manufacturing Purchasing Managers' Index (PMI) continued to rise, reflecting a stable macroeconomic environment and steady growth in downstream demand. Meanwhile, steel mills are gradually increasing production, leading to a rebound in social steel inventories. This has intensified the supply-demand imbalance, putting upward pressure on steel prices in the coming period. It is anticipated that this week (October 14–18, 2013), the domestic steel market will experience limited price fluctuations.
According to the weekly price forecast model from the Information Research Center, the domestic steel market is expected to remain within a narrow range. The long product market is also projected to show minimal fluctuations, while the plate market may see slight variations. The national steel price index is expected to hover around 139.6 points, with an average steel price of approximately 3,630 yuan, showing a fluctuation of about 20 yuan. Specifically, the long steel price index is expected to remain near 155.9 points, with only a minor change of about 0.1 point. Similarly, the sheet price index is projected to fluctuate around 120.1 points, with a similar small variation.
Market research data from the Information Research Center indicates that the domestic long product market will remain stable this week, while the plate market may experience some ups and downs. Raw material prices are expected to show moderate fluctuations, with iron ore prices rising by 5 yuan, coke prices remaining steady, scrap prices increasing by 20 yuan, and billet prices dropping by 20 yuan.
Looking at the previous week (Week 41, October 8–11, 2013), the national comprehensive steel price index reached 139.5 points, up 0.13% compared to before the holiday and down 7.48% year-on-year. The long product price index was 155.8 points, up 0.24% from before the holiday, but down 9.12% compared to the same period last year. The sheet price index stood at 120 points, down 0.03% from before the holiday, yet still lower than the same period last year by 4.80%.
During Week 41, the market prices of major steel products showed slight fluctuations compared to pre-holiday levels. While the number of rising varieties increased slightly, flat varieties saw more significant increases, and falling varieties declined notably. Out of 17 types of steel and iron products, five varieties rose, two increased significantly, and 18 fell. Steel raw material prices remained weak, with iron ore, coke, and scrap prices stabilizing, while billet prices dropped by 30–40 yuan.
This week, the rebar market struggled to climb, with a slight increase after five consecutive weeks of decline. The main 1401 contract held 15.08 million tons, with Masukura at 124,000 hands, and the main position gradually shifting to 1405 contracts, with 57,790 Masukura, totaling 306,000 hands.
The national steel industry stocks rebounded again, with social inventory levels rising across the board. In particular, the rate of building materials inventory increased slightly, and slab inventories also rose. As of October 11, the total steel social inventory in 29 key cities reached 13.7498 million tons, up 21.96 million tons from the pre-holiday level, representing a 1.62% increase. Wire rod inventories rose by 4.32%, rebar inventories decreased by 0.23%, and plate inventories increased by 3.65%.
Macroeconomic indicators suggest a stable economic growth trend. China’s manufacturing PMI for September was 51.1%, up 0.1 percentage points from the previous month. New orders, production, and purchases were the main drivers of growth, indicating continued recovery in enterprise operations. However, the pace of growth slowed, suggesting a cautious outlook for future economic development.
On the industry front, the steel and mining industry PMI dropped to 48.4%, entering contraction territory, signaling weaker demand and reduced market activity. Downstream demand remains a key factor, with transportation fixed asset investment in August reaching 186.5 billion yuan, up 3.3% year-on-year. Railways saw the fastest growth, with fixed asset investment increasing by 12.6%, while highway investments grew more slowly.
Overall, the steel market is expected to remain volatile in the short term, with limited price movements and ongoing challenges in balancing supply and demand. Investors and traders should monitor market conditions closely as the sector continues to adjust to evolving economic and industrial dynamics.
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