Steel prices in China and abroad are soaring, and China`s active supervision is

Recently, the increase in domestic steel prices has aroused public attention. On May 24, the China Iron and Steel Industry Association issued a report on its WeChat public account and made a judgment. As the downstream steel industry cannot withstand the continuous high consolidation of steel prices, it is difficult for the steel prices to continue to rise sharply in the later period.

In the international market, steel prices are also rising, and the increase is much higher than domestic steel prices. This round of price increases is the result of the gradual recovery of the global economy, enhanced market expectations, ample liquidity, and speculative speculation. China`s control of "price drive up" behavior is receiving increasing attention from international public opinion.

China Iron and Steel Association: There is no basis for continuous and substantial rise in steel prices

According to data from the China Iron and Steel Association, at the end of April, the China Steel Price Index (CSPI) was 148.88 points, an increase of 16.60 points or 9.25% from the end of March. A year-on-year increase of 52.26 points, an increase of 54.09%.

From the perspective of the "weathervane" rebar, the weekly China steel price index shows that the western rebar price index at the end of April was 5146 yuan per ton, an increase of nearly 400 yuan per ton from the 4751 yuan per ton at the end of March. The international market, like the domestic market, "prices fly together."

In April, the international steel price index (CRU) also continued its upward trend, reaching 275.2 points, an increase of 29.2 points from the previous month; an increase of 11.9%, an increase of 5.7% from March; an increase of 129.5 points, an increase of 88.9%, and its increase Both are larger than domestic.

In terms of price, the gap between domestic and international is more intuitive.

According to the news from the Central Broadcasting Network, taking the hot roll of important basic materials in the manufacturing industry as an example, in April this year, the price of hot rolls in the Midwest of the United States rose to (about 9,530 yuan), which is 70% higher than that ofChina. In some Nordic countries, the price of hot coils has exceeded 850 Euros per ton (close to RMB 7000). Steel prices are also rising in many places such as India and Japan.

In May, the impact of rising steel prices became more prominent.

The Press Trust of India (PTI) said on the 23rd that the Pipe Manufacturers Association of India (IPMA) had sent a letter to Prime Minister Modi and the Minister of the United Steel and Steel Department Dharmendra Pradhan on the 20th, requesting control of steel prices and restrictions on exports to ensure supply. .

IMPA said that in the past 10 months, Indian steel prices have risen by more than 60%, downstream companies have been unable to survive, and a large number of companies are facing bankruptcy.

Domestically, the industry judges that it is difficult to maintain the sharp increase in steel prices in the later stage.

The Iron and Steel Association report pointed out that the price increase in April was related to the strong demand in the downstream steel industry (real estate industry, manufacturing industry) and the increase in the price of raw fuels such as iron ore. But overall, Chinese steel production remained at a high level that month, and supply and demand were basically stable.

Looking at the later market, with the arrival of the rainy season and the slight cooling of the market, the construction, automobile and home appliance industries are about to enter the "off-season". Steel demand may also weaken to a certain extent, but supply and demand will continue to remain stable.

According to estimates by the Iron and Steel Association, the country`s crude steel output will increase by 0.4% month-on-month in May, and steel production will continue to remain at a relatively high level. At the same time, the rapid and substantial increase in steel prices in April is not in line with the actual production and operation of shipbuilding and home appliances. The Iron and Steel Association pointed out that [the steel products will not continue to rise substantially in the later period."

If the balance of supply and demand in the domestic market provides a basis for the overall stability of steel prices. So the country's active supervision of commodity transactions, including steel, will undoubtedly inject a "cardio booster" into the stability of the entire market.

China: "Say no" to malicious speculation and price bidding

In the face of this global price increase wave, the Party Central Committee and the State Council attach great importance to the work of ensuring the supply of bulk commodities and stabilizing prices. With regard to abnormal transactions, malicious speculation, price-raising, hoarding, and monopolies, China strictly investigates in accordance with the law, never tolerates them, and actively protects the production and life of the people.

On May 19, Premier Li Keqiang presided over an executive meeting of the State Council. The meeting pointed out that it is necessary to attach great importance to the adverse effects of rising prices of bulk commodities, focus on comprehensive measures in response to market changes, ensure the supply of bulk commodities, curb unreasonable price increases, and strive to prevent transmission to consumer prices.

The meeting specifically pointed out that [it is necessary to strengthen market supervision. Give full play to the role of industry associations and strengthen industry self-discipline. Strengthen the joint supervision of the futures and spot markets, and take targeted measures at appropriate times to investigate abnormal transactions and malicious speculation. Strictly investigate and deal with the implementation of monopoly agreements and dissemination in accordance with the law. False information, driving up prices, especially hoarding and other behaviors have been publicly exposed."

On the morning of May 23, the National Development and Reform Commission jointly interviewed and reminded key enterprises and industry associations in bulk commodities such as iron ore, steel, copper, and aluminum. The meeting pointed out once again that the prices of some commodities have continued to rise sharply since the beginning of this year. There are many aspects that reflect excessive speculation, disrupting the normal production and sales cycle, and contributing to price increases.

The meeting required that relevant key enterprises should strengthen their legal awareness, operate in an orderly manner in accordance with laws and regulations, and work with relevant industry associations to maintain the normal market order of the industry. The meeting also reminded that the regulatory authorities will closely monitor the price trends of bulk commodities, strengthen the joint supervision of bulk commodity futures and the spot market, and have "zero tolerance" for illegal activities.

In fact, as early as May 18, the Bureau of Economic Operation and Regulation had organized relevant departments, industry associations and key enterprises to hold a symposium to analyze and judge the economic operation of the industry in April and the trend in the first half of the year.

Relevant associations and enterprises all believe that the current economic operation continues the momentum of stable recovery, industrial production, investment, exports and other indicators continue to grow rapidly, some industries with greater downward pressure in the early stage have begun to improve, and market vitality and development momentum have significantly increased. In response to prominent issues such as the current increase in raw material prices, effective measures need to be taken to deal with various risks and challenges to ensure the stable and healthy development of the economy.

Under comprehensive factors such as active supervision and the balance of supply and demand, some markets in my country have cooled significantly month-on-month.

According to the monitoring data of Lange Steel Cloud Business Platform, as of May 21, the average price of Φ25mm grade 3 rebar in 10 major domestic cities was 5,360 yuan, down 600 yuan from the previous weekend; in terms of hot-rolled coil prices, domestic prices on the same day The average price of 5.5mm hot-rolled coils in 10 key cities was 5708 yuan, 705 yuan lower than the previous weekend.

China demonstrates its determination to insure prices and maintain stability, and the international market ushered in a slight cooling

Speaking of recent domestic commodity price fluctuations, Ge Honglin, President of the China Nonferrous Metals Industry Association, stated on May 22 that the fundamentals of the supply and demand of commodities have not changed substantially, and costs do not support such a large increase in prices. The promotion of funds is the key to this round of rise.

"Take aluminum, copper and rebar as examples. Due to the price increase of these categories, if the full cost is invested, the cost can be recovered in seven months, which completely deviates from the normal price growth range."

Ge Honglin pointed out that since the executive meeting of the State Council on May 12 called for an effective response to the rapid rise in commodity prices and its associated effects, the futures prices of steel, copper, and aluminum have fallen. But on May 17-18, prices rebounded again.

"Because some institutions still want to push higher profits, this underestimates the policy's determination and ability to regulate and control."

China's rational and active intervention in market behavior has also allowed the international market to cool down.

According to news from the BBC on the 24th, international metal prices have "slightly fallen" after months of surging due to the influence of China's reminding commodity companies to stay away from "price bidding". According to the report, the London Metal Exchange (LME) data showed that the price of copper fell to US$9,881 per ton, a decrease of 1.6%; the price of aluminum fell to US$2,370 per ton, a decrease of 1.09%.