High demand side performance of good screw steel high oscilla

 Beginning in late May, steel prices rose again in the wake of many environmental inspections. At present, there are still large uncertainties in the re production of steel enterprises in Xuzhou. The rapid downlink of steel stock, and the PMI super expectation in May, the demand side performance is good, so the steel price will be high oscillation in the short term.

Since May, environmental protection production is not limited to traditional 2+26 cities. In East China, due to the closing of the summit in Qingdao, the surrounding steel mills such as Shandong and Jiangsu have limited production tasks. At the same time, Jiangsu itself is still carrying out environmental protection inspection, and steel plants in Changzhou also have limited production tasks. The output of rebar in Jiangsu area is 610 thousand tons this week, which is significantly lower than the 750 thousand to 770 thousand tons in the same period of the previous year. The limited production in Shandong and Jiangsu will shorten the supply of rebar in East China in the near future.

Meanwhile, at the end of May, the first batch of central environmental inspectors started looking back. The inspection team has been stationed in Hebei, Henan, Inner Mongolia, Ningxia, Jiangsu, Jiangxi, Guangdong, Guangxi, Yunnan and other provinces. At present, the production of EAF steel works in Guangxi area of Guangdong is greatly affected. Last week, the capacity of the national arc furnace sample manufacturers dropped by 2.77% to 62.35%.

In June 4th, the market rumors that Steel coking enterprises in Xuzhou will resume production at the end of June. It is verified that the relevant enterprises are actively preparing for the resumption of production, and some enterprises have a high acceptance rate through the government, but there are also some enterprises passing rate is very low.

Good spot transaction in May

After the outbreak of April spot transactions, the market is generally expected to increase in East China's rain weather in Southern China, the May spot transaction and demand will be hit. However, from the actual situation, the average daily turnover of the national sample building materials traders in May is 194 thousand and 700 tons, and the 219 thousand and 500 tons in April do have a marginal sign of weakening, but it is still a new high level in the same period of history. According to the purchase volume data of Shanghai terminal line snails, the average weekly value in May is 26 thousand tons, which is higher than the average of 24 thousand tons in 5 years, but there is also a marginal weakening phenomenon compared to 39 thousand tons in April.

Overall, the spot trading in May compared with the explosion of the April, did appear marginal weakness. However, it shows good performance compared to the same period of history. Last week, the total inventory of the five major varieties decreased by 716 thousand tons, compared with a slowdown in the first half of May, but it began to accelerate again in the second half of the month. Later, we should pay attention to whether the inventory decline in June is more than expected.

Strong domestic economic resilience

In May, the official manufacturing PMI was 51.9, an increase of 0.5 percentage points compared with last month, a record high since last September. In terms of sub item data, new orders and new export orders have rebounded sharply compared with April. New orders rose from 52.9 to 53.8, and new export orders rose from 50.7 to 51.2. Finished goods inventories continued to drop to 47.2, and raw material inventories rose to 49.6. The growth of the new order index is obvious, reflecting the continued rebound in domestic demand. The new export orders also increased, and exceeded expectations in the context of trade friction. Overall, the macro economy shows strong resilience, which will partly alleviate the pessimistic expectations of the disk.