In June, domestic spiral welded pipe prices will be high and low
In May, under the background of carbon peak production reduction expectations and global inflation, speculative forces boosted steel prices to record highs after the long holiday. The prices of most varieties of steel increased by more than 1,000 yuan per ton; then various departments voiced several times to effectively respond The price of bulk commodities rose too quickly, and the price dropped sharply at the end of early May, and returned to the level of the end of April.
Among them, the varieties of welded and plated pipes are on the same "roller coaster", and the price of spiral welded pipes deviates from the fundamentals, and supply and demand tend to weaken; for June, after continuous cooling, will the steel price inflection point appear? This article will return to the fundamentals for a brief explanation.
First, the price of welded and plated pipes in May hit a record high
In May, the price of domestic welded-plated pipes rose and fell as much as 300 yuan in a single day, and the price fell by 1410 yuan in the middle and late ten days, which was 58.51% lower than the increase of 2410 yuan since the beginning of the year. Data show that as of May 31, the national average price of 4-inch (3.75) welded pipe was 5957 yuan, an increase of 173 yuan over the same period last month, and the national average price of 4-inch (3.75) galvanized pipe was 6,899 yuan, an increase of 334 yuan over the same period last month. The national average price of 50*50*2.5 square pipe is 6,007 yuan, an increase of 271 yuan over the same period last month; the national average price of 219*6 spiral pipe is 6,273 yuan, an increase of 353 yuan over the same period last month. From a regional point of view, the north is stronger than the south, and the market adjustments lag behind the management.
2. Flexible control on the supply side of welded pipe manufacturers
According to data released by the Bureau of Statistics, in April 2021, my country’s welded steel pipe output was 5.545 million tons, a decrease of 3.32% from the previous month, a decrease of 2.45% from the same period last year, and an increase of 22.79% from the same period in 2019.
The pipe factory ceased production again, and the role of traders as the "reservoir" declined. Data show that as of May 28, 2021, national steel stocks were 12.497 million tons, a decrease of 1.675 million tons from the same period last month. In the last week, the national steel stocks declined at a rate of 3.39%. Although prices stabilized rapidly or even rebounded partially at the end of the month, the overall transaction volume has not yet stabilized and increased.
According to statistics, 11 domestic welded-plated pipe major pipe factories flexibly stopped production by 50%-70% during the May 1st holiday and during the rapid price drop. As of May 27, the weekly output was 316,600 tons, a decrease of 2.95 month-on-month. 10,000 tons, while the factory warehouse was 900,800 tons, an increase of 65,700 tons over the same period last month. Among them, the finished product warehouse data was still an increase of 124,500 tons compared with the previous month in the two weak stages of supply and demand.
Also to avoid risks, market traders shipped more than replenished goods in supply and marketing operations in May, and some projects of downstream engineering companies were suspended for materials or consumed original inventory. According to statistics, the domestic social inventory of welded pipes was 825,500 tons, a month-on-month decrease. 3.49%. Inventory of some large and medium contracted households is still at a high level a year ago, and the current level of inventory sales is not up to expectations. Entering June, the profit of the management plant has expanded, the production capacity has maintained a flexible and high level, and the current situation of the slowdown in the pace of traders' sales and warehouses has become prominent, and the inventory platform period may come in the future.
3. Net exports of welded pipes keep increasing
The net export volume of welded pipes in April continued to increase by 31.96% month-on-month. According to the latest customs statistics, in April 2021, my country exported 399,400 tons of welded pipes and imported 22,700 tons of welded pipes. The cumulative net export of welded pipes was 376,700 tons, an increase of 11.33% over the same period last year and an increase of 5.10% over the same period in 2019. According to the national export statistics of welded pipes by country, the export volume of each country has increased. Among them, the growth rate of Europe and America slowed down to 34.65% and 33.57%, and the export to Asia was 203,000 tons, accounting for 50.81%, which was an increase of 1.0 month-on-month. Around percentage points.
The data shows that the new export order index of the steel industry in May was 43.9%, a drop of 7.8 percentage points from April. Foreign production capacity has basically returned to the pre-epidemic level. However, there is a gap in steel supply and demand in some regions, affected by the sharp decline in domestic prices. The advantage of the price difference between China and foreign countries still supports steel exports in June. At present, global monetary easing is entering the second half, emerging market countries have begun to raise interest rates, and the appreciation of the RMB against the US dollar will widen the existing domestic and international steel price gap.
Fourth, the demand side faces double pressure
Data shows that the apparent consumption of crude steel equivalent to 91.66 million tons in April, a year-on-year increase of 12.8%; the demand expansion cycle of "unconventional" growth in steel consumption after the epidemic is approaching the top.
In terms of the types of welded and plated pipes, the average daily shipment of 11 tube factories was 20,800 tons, a decrease of 27,100 tons from the same period last month; the domestic regional trade shipments fell by 8.12%, of which North China and Northwest China declined. At the top, the monthly reduction reached more than 40%. This round of price surges and speculative atmosphere are on the rise, but the fundamentals are just in demand.
According to the survey, 56% of engineering units suspended construction progress for about a month or consumed original inventory to slow down the pace of procurement; engineering suppliers reduced the quantity and pace of land supply due to financial pressure and price coordination. The demand suppressed by high prices in early June will be gradually released, and some engineering suppliers will begin to lock in goods. From mid-to-late August this year, the rainy season forecast precipitation is 340-370 mm, which is more than normal in previous years. Traditional seasonal demand The pressure continues to deepen.
The focus of cost in May and May still moves up
The overall decline in May at the end of the finished product was greater than that of the end of the raw material, and the cost of steel mills moved up from the end of the previous month. The data shows that on the 28th, the average cost of steel mills in Tangshan area was 4461.8 yuan. Based on the ex-factory price of ordinary carbon billet in Qian'an area, the profit fell to 318 yuan, a reduction of about 723 yuan on a month-on-month basis. Before the end of June, the national carbon trading system was launched. At the same time, the “look back” of iron and steel capacity reduction, the reduction of crude steel output, and the environmental supervision work began, and the crude steel output will not increase significantly in the later period. The introduction and implementation of policies on the production side in the future will become a price support factor.
In terms of the types of welded-plated pipes, production restrictions have an impact on the upstream raw material strip steel. According to statistics, the capacity utilization rate of 31 strip rolling lines is 73.8%, affecting about 84,500 tons of daily output, which is a decrease in daily output compared with the same period last month. 4,000 tons. However, the current mainstream warehousing inventory in Tangshan area totals 540,100 tons, which is more than half the level of the same period last year. Due to profit contraction and the inspection team’s "look back" on the dual constraints of illegal production capacity, the strip steel supply side mostly performs in range fluctuations. .
In terms of price, the representative tube factory flexibly controlled the price difference between the raw material Ruifeng strip steel in May, up to about 200 yuan in the month, and the average price was 156 yuan compared with the settlement price of 355mm series strip steel on the 25th, maintaining a meager profit. At the same time, the statistics of the raw material inventory in the 11 main catheter plants was 348,700 tons, a decrease of 58,800 tons on a month-on-month basis. The operating logic of market traders’ shipments exceeding replenishment was superimposed. In June, the support for the cost of welded and plated pipes weakened, and future welding The price drive of plating tube is more reflected in the game between the price of the tube factory to stop production and the demand.