(Zhang Zhaoli, analyst of Zhuochuang Information)
[introduction] in April, stainless steel and its upstream varieties were mainly adjusted, and the continuous rise of futures and short-term replenishment of the terminal led the market. In May, the stainless steel market may be strong at first and then weak, and the pressure on the industrial chain may gradually rise.
Stainless steel as a variety closer to the downstream terminal industry in the industrial chain, its market drivers are not only the fundamental changes of supply and demand, but also affected by the upstream raw materials, among which nickel system and chromium system are the most representative.
In April 2024, the prices of stainless steel and upstream nickel and chromium varieties were mainly adjusted. Futures disk center of gravity shock upward, driving the adjustment of raw material prices, superimposed stainless steel demand intermittent follow-up, together to support stainless steel prices emphasize integration, and achieve upstream and downstream industrial chain market upward.
Stainless steel market: market shock strong futures continuous rise and short-term replenishment of terminal positions to drive the market
From the point of view of the changes of stainless steel itself, the market shock in April is strong, and the price center of gravity has moved up. From the point of view of average price, as of April 29th, the average price of cold coil in Wuxi Taiyuan Iron and Steel Co., Ltd. was 14450 yuan / ton, up 1 yuan / ton from last month's average price.Mosttechs60freespins.01%. During the statistical period, both inside and outside nickel and stainless steel futures showed a fluctuating rising trend, and the support for stainless steel increased. The shipping atmosphere in the stainless steel spot market improved intermittently, especially after Ching Ming Festival's holiday and when the news of Russo-Nickel sanctions broke out, which also supported the market. on the whole, the rising market was mainly driven by futures rising and terminal short-term replenishment, while the decline was mainly dragged down by the weakening of replenishment and the pullback of futures. Near the end of the month, the industry remains optimistic about the market replenishment before and after the May Day holiday, and the market support still exists.
From the perspective of the industrial chain, the upward trend of stainless steel in April and the strengthening trend of the main raw materials complement each other. From the point of view of the changes in the price trend of various varieties, except for the downward trend of ferrochrome market,Mosttechs60freespinsAll his varieties have achieved a rise in prices. Among them, the center of gravity of stainless steel prices has moved upward, and its supply digestion has also supported the varieties of raw materials, and the average price of electrolytic nickel has risen most obviously. in addition to being supported by the recovery of the stainless steel market, the news that Russian nickel has been sanctioned has an obvious driving effect on the futures market, and the rising trend of electrolytic nickel prices is relatively more prominent. In addition, the market of ferronickel and scrap stainless steel is also driven by the warming of market trading, together with the reduction in imports of ferronickel and the increase in the inquiry price of scrap stainless steel in steel mills, leading to a stronger price adjustment. In comparison, the trend of ferrochrome is relatively weak, the port inventory of chromite has increased, and the price of ferrochromium closely followed the steel guide price of mainstream steel mills in the first ten days to maintain a high position, but the weak transaction led to a decline in market prices in the middle and last ten days. this price drop is mostly a reasonable pullback of false high components. On the whole, the stainless steel market has picked up and increased.Mosttechs60freespinsThe market support of the upstream raw materials, at the same time, the rise of raw materials has also consolidated the cost support of the stainless steel market.
Profit: stainless steel profit margin rebounded
From the point of view of the change of cost and profit, as of April 28, the production cost of stainless steel in April was 3% higher than that at the end of last month.Mosttechs60freespins.00%, the average monthly cost decreased by 0.21%. The price center of gravity of stainless steel products moved upward, superimposed the hedging impact of the raw material procurement cycle, and profit margins continued to pick up. Production profits increased by 24.75% compared with the end of last month, and the average monthly profit increased by 12.52%. Although the main driver of raw materials in nickel, scrap stainless steel market upward, but ferrochromium, pig iron market center of gravity moved down, so stainless steel profit space to achieve a rebound. Taking into account that with the continuous recovery of profit space, enterprise production will may remain relatively high, but the impact of traditional consumption season is weakening, or limit the room for output increase, the supporting role of various varieties on the raw material side may be weakened.
In the future, it is expected that stainless steel may be strong first and then weak, and the pressure on the industrial chain may rise gradually.
From the perspective of the late trend, considering that as profits continue to pick up, the enterprise production is active, the overall supply may maintain a relatively high trend, while the terminal demand is still expected to continue to replenish around the May Day holiday, and the short-term support expectation on the demand side still exists. the fundamental pressure of supply and demand in the stainless steel market is not great for the time being, in addition, the cost support is relatively strong and the market continues to be bullish. However, it is necessary to be cautious about the drag that may be caused by the increased impact of the off-season demand in the later period. It is expected that the stainless steel market will be strong and then weak in May, and then the stainless steel market will continue to be under pressure under the expectation that the impact of the off-season of traditional consumption will continue to rise.
From the point of view of the industrial chain, stainless steel as a downstream variety, its market short-term support may still be able to support upstream raw materials. In addition, with the strong operation of steel recruitment guidance price, the enthusiasm of the holder is high, and there is a chance for ferronickel prices to continue to rise in May. The May steel move of TISCO in the ferrochromium market has not yet been announced. Castle Peak Steel recruitment guidance price is stable, the market wait-and-see mood is the main, and the market is likely to maintain stability. Under the influence of tight circulation resources and relatively optimistic economy, scrap stainless steel may still have some strong space, the raw material end is expected to be strong or continue to support the cost of stainless steel, and the overall industrial chain market still has a strong driving force. however, the possibility of increasing pressure in the future is also strong.