In June, the steel market volatility trend has been contained, some of the end of May prices fell varieties also appeared a certain repair.

According to statistics from steel traders, since the second quarter of this year, the National Development and Reform Commission and local development and reform commissions have conducted at least seven investigations and discussions on the issue of commodity prices, and listened to the opinions and suggestions of representatives from various sectors on the topic of carbon peak and carbon neutral at least nine times.The executive meeting of the State Council deployed the work of “ensuring supply and stabilizing prices” for bulk commodities to keep the economy running smoothly.The Ministry of Industry and Information Technology said it will cooperate with relevant departments to resolutely crack down on hoarding, malicious speculation and price gouging…Steel traders believe that in the “stable price” regulation, steel city is difficult to stage a “roller coaster” market.

At present, the construction machinery industry production and sales situation is depressed, construction machinery production and sales since April began to fall, continued to decline in May.Steel traders believe that this is due to the sharp rise in steel prices, leading to the price of construction machinery, the downstream procurement enthusiasm caused a certain impact, the demand for steel is also reduced.However, with the “stable price” regulation landing, downstream enterprises due to the early rise in steel prices and suppressed demand will be released.

Steel traders believe that in the context of carbon peak, carbon neutral, steel industry control capacity, production reduction and other work will continue to be fully launched.In addition, after the high steel prices fell, the profit of steel enterprises contracted significantly, the enthusiasm of production was suppressed to a certain extent.Some steel enterprises choose to carry out routine maintenance in June.Some steel enterprises plan to overhaul a hot rolling production line on June 30, some steel enterprises postpone the maintenance scheduled in May to June 7 ~ 21, some steel enterprises from June 16 to a cold rolling production line for 10 days of maintenance……Environmental protection limit production, steel enterprise maintenance and other factors will lead to the decline of steel production in the later period, and then alleviate the market supply and demand contradiction, promote the stable operation of steel prices.

In view of the State Council executive meeting recently put forward the “two-way tariff regulation to help ensure supply and price stability of bulk commodities” method, steel traders said that through the tax means mainly to solve the contradiction between supply and demand, to achieve a relatively balanced supply and demand relationship, but also has the role of stabilizing expectations, to avoid the increase of speculation.

In general, with the implementation of the “stable price” regulation policy, the steel city will tend to be stable and good operation.

Excerpt from China Metallurgical News (June 24, 2021)