The steel market in the winter "heating season" may show a pattern of weak supply and demand_PTJ Blog

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The steel market in the winter "heating season" may show a pattern of weak supply and demand


Introduction: After heating began, the Beijing-Tianjin-Hebei region and surrounding cities have successively issued policies such as "stop work order", "land closure order" and "shift production", although after recent months of environmental protection inspections and "policy warm-up" for heavily polluted weather, Most steel companies seem to be ready, but the impact on downstream steel demand cannot be ignored.

The steel market in the winter heating season may show a pattern of weak supply and demand

Recently, Beijing, Zhengzhou, Shandong and many other cities have successively issued "stop work orders" for the downstream construction industry. Many places in Shandong have officially started to implement work stoppage measures at 12 o'clock on the 14th, and local governments are also very serious about the implementation of the suspension policy during the heating season. . At the same time, construction industry-related companies other than steel companies, such as cement and brick kiln industries, are also under the influence of the "shift production" policy.

Since this shutdown cycle covers the entire "heating season", this has a huge impact on the steel industry, which is already in the low season of demand in winter, from the policy content of "shutdown" and "shift production" in downstream construction and related industries. From a point of view, the impact has the characteristics of "long, deep and wide".

Based on feedback from downstream construction companies and careful reading of policy terms, how will the actual demand for steel be affected? On the one hand, the environmental protection requirements of downstream construction sites are mainly concentrated in the category of dust, and the earthwork in the early stage of construction is the most severe stage of dust during the entire construction period, that is, in the range of trenching, backfilling, sand and gravel transportation, etc. For construction sites that have completed foundation works and are undertaking superstructures, the dust index is relatively well controlled. The use of construction materials at this stage is mainly concentrated in steel and concrete. That is to say, the demand for steel use at this stage is relatively stable. .

According to estimates based on the ratio of the foundation steel usage of ordinary housing construction projects to the total engineering steel usage at the current stage, the foundation construction stage steel usage accounts for about 10% to 15% of the total engineering steel usage. The construction site is in the early stage of construction, accounting for about 20% to 30% of the total number of construction sites. That is to say, in the construction sites where the suspension order cannot be carried out at all, it will also play a role in 20%, while in other construction sites that have already undergone mid- and late-stage construction, there is still a certain demand for steel. According to Jinlianchuang's long-term tracking and calculation of steel demand for the construction industry, it is found that between November 15 and the end of December this year, compared with previous years, construction steel is estimated to decrease by 30% to 35% year-on-year.

On the other hand, due to the decrease in temperature, during the period from mid-November to the end of December, the construction of the northern downstream construction site also needs to be based on the climatic conditions and the requirements of the start-up schedule. Under normal circumstances, the operating rate is in a state of declining, which is affected by the difficulty of low-temperature concrete operation and The impact of frozen soil in some areas is also within the scope of "staggered production" for the concrete industry this year. Steel, cement, brick kilns and other industries have entered "staggered production", and the supply is also decreasing overall. Downstream construction sites The operating rate of the company will inevitably be constrained by both policy and resource pressures.

In other words, after the start of the winter "heating season", the downstream demand for steel will theoretically still show a significant downward trend, and steel companies are also in the cycle of "staggered production", and both supply and demand continue to weaken. Under circumstances, the overall operating state of the steel market may enter a period of low activity ahead of schedule, and the performance of the two weaknesses of supply and demand will be more obvious.

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