Some Points to Watch for in the Later Trend of Steel Production

As for the trend of construction steel , there are still several issues that must be watched closely by post-merchants:
First, the national macro-strength has been further strengthened
The data recently released by the National Development and Reform Commission shows that since the beginning of this year, the national economy has continued to maintain steady and rapid development. According to preliminary calculations, in the first quarter, the gross domestic product was 502.87 billion yuan, an increase of 11.1% year-on-year, and the growth rate was 0.7 percentage points higher than the same period of last year. Premier Wen Jiabao of the State Council presided over the State Council executive meeting on the 18th to analyze the economic performance in the first quarter and deploy the current economic work. Among them, we must continue to strengthen the regulation of investment in fixed assets. The market entry standards for new projects are strictly enforced, and more stringent conditions are formulated and implemented in terms of energy conservation and environmental protection, and construction that does not meet the standards cannot be started. We will earnestly implement the regulations on the use of land for prohibited and restricted projects, and we must pay close attention to improving and strictly implementing the criteria for economizing and intensively using land, and further clean up and investigate violations of illegal land use. Control the scale of urban construction and thoroughly clean up and standardize various types of development zones. Correctly guide the direction of social investment and optimize the investment structure.
In the first quarter of this year, China's real estate development investment reached 354.378 billion yuan, a year-on-year increase of 26.9%, and the growth rate was 1.6 percentage points higher than that of urban fixed-asset investment during the same period. In the first quarter of this year, investment in urban fixed assets investment reached 1,455.4 billion yuan, a year-on-year increase of 25.3%. This growth rate was significantly higher than the 23.4% growth in January-February this year, indicating that the pressure for investment rebound is still huge. It is foreseeable that the government may still introduce further investment control measures in the second half of the year to consolidate the results. At the same time, interest rate adjustments, taxes, and other aspects of the regulation and control efforts may once again increase, will have a certain impact on the construction steel market demand.


Second, there is a certain relationship between the fluctuation of construction steel stocks and market prices. Attention should be paid to the changes in stocks. Taking Beijing as an example, when the market inventory is between 280,000 tons and 280,000 tons, the market price basically maintains a small fluctuation, when the market stock rises. To more than 500,000 tons, the price will drop sharply. For instance, when Beijing stocks were at 537,000 tons in 2006-2-15, the price of Beijing 25mm rebar was at the lowest point of 2,830 yuan. However, inventory of domestic construction steel stocks has been at a relatively high level in March this year. From the figure, stocks in January 2007 have fallen slightly. Inventories have risen sharply during the Spring Festival period in February. Market transactions in March have been general, and “two sessions. The impact of inventory in March made history at a record high of 595,900 tons, while the highest inventory in March 2005 was 517,700 tons. In February 2006, the highest inventory was 537,000 tons. And in March 2007, 59.59 million tons is the highest level in history, high inventory will have some pressure on the market, and the rapid decline in inventory in April, indicating that market demand began to increase, the market price rise.
Also including the cancellation of export tax rebates will have an impact on the market in the second half of the year. Steel mills' export resources will be reduced and will be passed on to the domestic market. Increased market resources will create greater pressure. (thunderstorm)



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