Cold or hot rolled coil prices may fluctuate slightly in the short term

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In the past May, the cold and hot-rolled coil market continued to fluctuate, prices rose and fell, traders' mentality was unstable, and most of them were mainly based on price cuts, and they were cautious about the market outlook. Li Zhongshuang, general manager of Shanghai Ruikun Metal Materials Co., Ltd. predicts that according to the current operating conditions, the entire cold and hot rolled coil market will not change much in the short term, and the price may fluctuate slightly.

Last Thursday (June 7), the prices of cold rolled coils in the Shanghai market are as follows: Angang's 1.0mm cold rolled coil is quoted at 4,660 yuan/ton, and Angang's 1.0mm cold rolled sheet is quoted at 4,690 yuan/ton; The price of 1.5mm cold-rolled sheet for production is 4,620 yuan/ton; the price of 1.0mm cold-rolled sheet for Baowu Group's WISCO is 4,670 yuan/ton; 1.0 for steel products of Shougang, Hegang, Tangshan, Hegang, Xicheng, etc. The price of millimeter CRC is 4,630 yuan / ton ~ 4,660 yuan / ton. In the same period, the price of hot rolled coil in the Shanghai market was generally 4260 yuan / ton ~ 4470 yuan / ton.

Li Zhongshuang believes that nowadays, traders also need to pay attention to the following uncertain factors that affect the market trend:

First, uncertain factors affecting the market demand for cold and hot rolled coils still exist. Since the beginning of this year, the production and sales of major customers of cold and hot rolled coils such as automobiles and home appliances have been in good condition, and both production and sales have shown a growth trend. The demand intensity of cold and hot rolled coils has not weakened. However, due to the slightly higher output of some home appliances, high inventory has led to a slowdown in the production of home appliance companies, which has affected the demand for cold and hot rolled coils. In addition, the sharp decline in automobile tariffs will have a certain impact on the domestic automobile manufacturing industry, thus affecting the demand for automotive steel. The Customs Tariff Commission of the State Council announced on May 22 that since July 1, 2018, the import tariffs on automobile and parts will be reduced. The 135 tax codes with a vehicle tax rate of 25% and the tax rate of 20% will be 4 The tax rate of the tax number was reduced to 15%, and the tax rate of 79 tax codes with auto parts tax rates of 8%, 10%, 15%, 20% and 25% was reduced to 6%. The tariff reduction caused the price difference between imported parts and domestic parts to be significantly narrowed, which adversely affected domestic related parts and components enterprises. In addition, the tariff reduction has certain impact on the important raw materials required for automobile manufacturing, such as steel, tires, glass, plastics and other markets. These uncertain factors will have a certain impact on the market demand for cold and hot rolled coil in the later period, which requires traders' attention.

Second, uncertain factors affecting the production costs of cold and hot rolled coils still exist. Recently, the prices of raw materials such as coke and iron ore have increased, especially the price of coke has risen in the fifth round, with an increase of 250 yuan/ton to 350 yuan/ton, which has led to an increase in steel production costs. In addition, the recent international crude oil prices continue to climb, has jumped to the $70/barrel mark. Industry insiders predict that in the future, the crude oil market in the international market will rise to 100 US dollars / barrel, which is more than 40% higher than the current price. The continuous rise in international crude oil prices will undoubtedly increase the production and logistics costs of iron ore. The ex-factory price of steel mills is likely to rise and fall, which will become a major driving force for the stabilization and recovery of steel prices in the spot market.

Third, uncertain factors affecting the supply of cold and hot rolled coil markets still exist. As the cost rises, the ex-factory price of steel mills is also raised. At present, the profitability of steel enterprises is still good and the production enthusiasm is high. However, factors affecting the release of steel mill capacity also exist. Recently, local governments have stepped up efforts to rectify environmental protection. Enterprises have been listed as key targets for rectification, and production and production suspensions have increased. In addition, the Qingdao Shanghe Summit was held from June 9th to June 11th. In order to ensure the local air quality, the polluting enterprises around Qingdao have already stopped production and limited production, and the cycle is about one month. From this point of view, in mid-June, with the limited production of steel enterprises, production growth is limited, which will directly affect the entire steel market including cold and hot rolled coil.

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