In 2018, the supply of steel capacity in the steel industry will still be affected by environmental protection policies. The output of crude steel in the heating season will decrease sharply as compared with the same period of last year. It is expected that the production will be limited in the heating season as well as the high price of steel (3756, -53.00, -1.39%), Low inventory of steel prices next spring, a strong supportive role, does not rule out triggering a spring market, steel prices in January-April or a new high. It is expected that the output of crude steel will keep unchanged or slightly decrease from 2017, the probability of decline in downstream demand will decrease, and the absolute volume is still expected to increase slightly. However, taking into account the second quarter of the steel production pressure and post-May seasonal pressure of downward pressure on May-October steel prices may continue downward.
The first quarter is the traditional off-season supply of iron ore, need to pay attention to the specific time of the steel mills re-production and iron ore replenishment efforts, due to the downstream demand will gradually pick up in March, once the steel prices open gains, mills replenish Or lead iron ore prices sharply higher, after May if the steel prices continue to decline, then the ore prices will also follow the decline, taking into account the iron ore supply in the second half of the season, and new capacity overseas mines in the second half has been fully operational, if Into the November heating season before the steel mills again to iron ore in advance to the stock, so the third quarter, iron ore prices will significantly increase the pressure.
2, 2018 steel futures strategy: 1, 1805 deep rebar contract discount, the current rate of discount thread has been reflected in the market arbitrage on March next year, the northern steel mills expected double-return and pessimistic view of demand. Spring next year needs to be concerned about the recovery pace of demand, it is recommended to seize rebate 1805 contract affixing opportunities. 2. Next year, under the stimulation of high profitability, steel mills will have a higher probability of producing at full capacity from March to October. Supply is expected to exceed demand after May, taking into account that the second half of the year is also the iron ore supply peak season. It is suggested that the 1850 contract for rebar and 1810 contract iron ore short rallies. 3, the current actual production profit thread in the 1400-1700 yuan / ton, 1805 contract rebar disc profit of about 1050 yuan / ton, can be considered to do more rebar 1805 contract profit. 4, the current rebar futures showing the pattern of long-term discount in the real estate downstream potential unfavorable circumstances can not be fake 10-5 spreads or 1-10 spreads can grasp the positive opportunities.
3, The risk point: the introduction of new restrictions or economic stimulus policies; to capacity tasks, real estate regulation and implementation of environmental restrictions on production; the real estate market fell more than expected, machinery, automotive and other industries more than expected decline in demand risk.
2017 Market Review
In 2017, the market is coming to a close. Looking back at the market trend this year, the ferrous metal sector gained the lead. We think the 1801 contract has run through almost all of 2017 since its listing in mid-January. Therefore, we compare the increase of 1801 contracts for all black varieties. The closing contract price of contract 1801 was up 32.9% from the beginning of the year. The contract price of hot rolled coil 1801 rose 20.3% from the beginning of the year. The contract price of raw iron ore futures 1801 weakened and the closing price dropped 12% from the beginning of the year. In the whole year, the ferrous metal sector showed a strong pattern of strong raw materials for finished products, which is the opposite of 2016. Spot prices rose more in line with the futures, Shanghai thread up over 50% throughout the year, foreign ore fell 8.81%.
2018 Outlook
In 2018, the steel market decides the long-term price movements mainly from the supply and demand, and the inventory determines the short-term price movements. We think that with the implementation of the supply-side reform and real estate regulation and control policies, the marginal utility of these policies on market prices is gradually diminishing. On the one hand, the stage of intensive introduction of the most stringent policies is over. On the one hand, the markets are accustomed and the expectations of these policies are reflected in the prices. Therefore, the forces affecting the price movements in 2018 mainly come from the game between supply increment and demand increment . Due to its proprietary nature in the steel industry and the industry chain that involves many industries related to national economy and the people's livelihood, the orientation of the policy often plays a decisive role in the price of steel. Need to pay close attention to: 1, under the existing policy, to capacity tasks, the implementation of real estate regulation and control; 2, the introduction of new restrictions or economic stimulus policies and the implementation of the situation.
