Domestic steel prices experienced a sharp decline in the second quarter after the formation of a price advantage, coupled with the increase in steel demand for infrastructure in emerging economies, inspired the enthusiasm for domestic steel exports. According to the statistics of the General Administration of Customs, China's exports of steel in November 800.5 million tons, an increase of 43.2%, continued the high growth in October; From January to November, China exported 82.658 million tons of steel, an increase of 35.6%. From the perspective of export volume, the proportion of steel exports in January to October this year is about 6.6% of the total domestic output, which is higher than the level of 5% for the whole year of last year. According to the latest export list of steel mills released by SMM, the export list in December is still performing well, and the slight increase from the previous month, and the annual steel exports are expected to exceed 90 million tons. From the point of view of products, the cumulative domestic export of automobiles from January to October was 4.239 million, an increase of 62.4%, of which 527,000 were exported in October, an increase of 49.7%; From January to October, the cumulative export of household appliances was 3.06 billion sets, an increase of 8.4%, of which 310 million sets were exported in October, an increase of more than 21%; From January to October, a total of 3940 ships were exported, an increase of 20.2%, and the monthly export in October still increased. It can be seen that the increase in export demand for end products has provided an important support for the strong external demand for steel, and has also become an important support for the strong resilience of China's manufacturing industry.
It is worth noting that domestic demand this year is weaker than in previous years. Can exports do well enough to offset weak domestic demand? In this regard, China Steel Futures steel researcher Li Gang told the Futures Daily reporter that the overall domestic steel demand this year fell by 1.3% compared with last year, but the structure of the differentiation. Demand for building materials was weak, continuing last year's performance; Hot coil demand is general; The demand for medium and thick plate, cold rolling and galvanizing increased rapidly. Correspondingly, the real estate market continued to weaken, while the shipbuilding, home appliances and automobile industries in the manufacturing sector performed well. Specifically, from January to October domestic steel demand decreased by 14.874 million tons, while the current export increased by 13.413 million tons, basically offset the domestic demand reduction, and then take into account the indirect exports of the manufacturing industry, this year in the case of a decline in domestic demand, exports to provoke "girder", the overall steel demand is expected to achieve positive growth compared to last year. Growth is expected to be 1% to 2%. Qiu Yuecheng, research director of Everbright Futures Black, shares the same view. He believes that domestic demand this year is stable, but structural. Affected by the sluggish performance of the real estate industry, the demand for rebar is poor, showing a weak situation of supply and demand. Relatively speaking, the steady growth of manufacturing and infrastructure investment has largely hedged the decline in steel demand caused by the weakness of real estate, especially in the manufacturing industry, shipbuilding, automobiles, home appliances and other industries are bright, and the demand for plates is relatively strong.
"This year, infrastructure has maintained a strong supporting effect on economic growth. From January to October, the country's infrastructure investment (excluding electricity) increased by 8.27% year-on-year, which is a high level in the past six years." Haitong futures investment advisory department black group leader Qiu Yihong said. In addition, the manufacturing industry boom this year was high before and low, and the annual peak was 52.6%, which appeared in February. In the sub-indicators, except for the orders in hand and raw material inventory index below the boom and contraction line, the rest of the sub-indicators are at a historical high. From the point of view of the breakdown industry, automobile production throughout the year oscillating upward trend, white goods production basically maintained at a high level throughout the year, the shipbuilding industry also provided strong support for the manufacturing industry, but the overall performance of the construction machinery market is weak, can be seen as the biggest drag on the manufacturing industry. Qiu Yihong believes that rising exports will not offset the impact of shrinking domestic demand. This year, China's steel exports are expected to maintain a growth rate of 30%-33%, and the market generally for next year's economic growth expectations in the United States and the eurozone have been lowered, indicating that the overall European and American economy still has a stagflation risk. Due to the continued uncertainty in the overseas economic environment, exports are expected to decline by about 10% next year. Qiu Yuecheng believes that domestic demand is relatively weak, crude steel production has increased, but steel inventories have declined slightly, indicating that the substantial growth of steel exports has not only digested the increase in production, but also digested the inventory to a certain extent. The export boost to steel demand is obvious.
For the steel market, Li Gang believes that from the rule of previous years, during the off-season, the fundamental trading weight has decreased, and the macro trading weight has increased. On the macro side, there is a high probability that the Federal Reserve will not raise interest rates at the interest rate meeting in December, and the market expects the end of this round of interest rate hikes and the fastest rate cuts to begin in May next year; Last Friday's meeting of the Political Bureau of the Central Committee set the direction of macro policy is still "positive", the intensity and scale remain "moderate", and the overall macro atmosphere is good. In the short term, the Political Bureau meeting of the Central Committee set a relatively positive tone, proposing to promote stability, first stand and then break, making the market for next year's steady growth further, and the traditional economic engine such as real estate will still have some support expectations. In the medium term, from the end of December to the middle of January next year, the market focus on steel steel raw material replenment, the current raw material inventory is overall low, once the steel steel high iron production New Year, the price elasticity of raw materials will be larger, and then the steel cost side formed a strong support, steel prices are expected to rise and fall. Qiu Yihong believes that there is no obvious contradiction in the short-term steel supply and demand pattern, and the Politburo meeting of the Central Committee set the direction of next year to adhere to the stability of progress, to promote stability, first stand after breaking, in the context of strong macro expectations still exist, and the overall direction of stability in the bias, the fundamental pressure is weak will still have a certain supporting effect on steel prices. The probability of the supply of raw materials before and after the Spring Festival next year is small, low inventory under the steel plant Spring Festival replenishment logic positive market sentiment, steel prices may strengthen to the end of March and early April. The steel market is expected to show the characteristics of supply with a top and demand with a bottom throughout the year, the market oversupply pattern does not change, and the price is expected to show an N-shaped trend in the game between macro expectations and fundamental reality.
