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Seamless steel pipe trend is entangled

Date:2018-12-13    View:539      Tag:Seamless steel pipe trend is entangled
With the recent decline in the price of seamless steel pipes, the disk has already seen the support of cost and high discount. The current rhythm is that the spot decline has increased, but the futures decline has slowed down. The key to how the premium is finally repaired is when the spot will stop falling and the time of inventory accumulation.

    Issues such as inflation and trade frictions hamper global economic growth. In the medium and long term, weak demand will put pressure on the domestic economy, and the impact of trade friction on economic growth will gradually ferment. The overall decline of industrial products in the near future is generally large. In the context of the continued sharp decline in crude oil, industrial products have been simultaneously weakening. From November 1 to November 12, the WIND industrial products closing price index recorded negative growth. Non-metallic building materials, chemicals, coal coke ore and colored plates rose and fell in the order of -3.57%, -3.16%, -2.99%, -2.74% and -0.67%.

    The market’s pessimism about the macro economy next year is particularly a concern for the real estate industry. Since 2016, the real estate sales area has shown a downward trend, and we have seen that the new construction area of real estate has turned head-to-head in 2018. It has continued to rise for 5 months, up by 0.5 points from January to August. 16.4%. However, in the context of continued weakening sales area, the market believes that this continued sluggish sales will be transmitted to real estate investment and new construction. Coupled with the nationwide high-pressure policy on real estate, concerns about the turning point of real estate have gradually deepened. Real estate, as the core industry of the current real economy, once the turning point occurs, may increase the pressure of the current economic downturn.

    On the supply side, this year's winter heating season has been relaxed compared with last year's heating season. Under the high operating rate of steel mills, the market is worried about the rapid accumulation of seamless steel pipe inventory in the later period.

    Whether it is the statistics of the Bureau of Statistics, China Steel Association or professional website for domestic steel production, it has shown a rapid rise in 2018. Under the stimulation of high profits, steel mills have various ways of raising production, increasing utilization rate of production capacity, and continuously increasing production of crude steel. In such a high production background, once the demand slows down or stagnate, the staged imbalance between supply and demand will easily lead to a rapid rise in inventory, which will bring huge inventory pressure to the market.

    On the demand side, recent demand has shown signs of gradual weakening. Market transactions have continued to weaken since the end of October, and the off-season effect has begun to appear. As the weather in the north gradually turns cold, this slowdown in demand will continue, and eventually the demand for seamless steel pipes in the winter terminal construction sites in the northern region will be stagnant. The overall demand in winter is stagnant, requiring traders to carry out winter storage to digest market resources. However, the current spot price is high, traders' winter storage willingness is weak, and the enthusiasm of terminals and traders is weak. Traders are generally worried about the current If the price is for the winter storage, the price drop after the Spring Festival in the coming year will suffer a large loss. This situation has occurred since the Spring Festival in 2017. Under the dual drive of supply and demand, the catalytic market is pessimistic about the increase of the library.

    Judging from the current situation, the market has a strong wait-and-see attitude, and the seamless steel pipe may turn into an oscillating trend.

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