How the steel prices will be in June?
The prosperity of steel industry is declining, the price of iron ore will tend to oscillate.
At the 13th Iron Ore International Market Seminar on the 4th, June, Wu Jingjing, deputy director of the market research department of China Iron and Steel Association, said that the most intense supply and demand phase of iron ore has passed, and the next half year's demand market of iron ore depends on the production of steel and changes in demand. The iron ore main contract has shown obvious shock adjustment signals in the futures market in recent days.
Xu Liying, an analyst at Lange Steel Research Center, told reporters that the total PMI index of steel circulation industry in May 2019 released by the Lange Steel Cloud Business Platform was 48.7, down 2.8 points from April. In May, sales of steel circulation fell, inventory digestibility slowed down, market expectations were divergent and purchase intentions became cautious.
In the production process, from the PMI of the steel industry surveyed and released by the China Federation of Iron and Steel Logistics Professional Committee, it was 50.0% in May, down 2.1% from April. Among the sub-indices, the production index, purchase volume index, import index and purchase price index all increased, while new orders, new export orders and raw material inventory indexes declined. It indicates that the mills' production expanded, but the growth rate of domestic and foreign market demand declined, and the pressure on raw material costs of enterprises has increased.
He Hangsheng, a steel analyst at the Business Community, said that the ex-factory price of steel mills in May was generally flat compared with that in April, but it was also difficult to curb bearish sentiment in the market, and the spot market also showed “lower transactions, transaction lower prices, lower purchase price and cleaning ventory". According to the current situation, the futures derivatives market is still in the downside of the shock, and the raw materials are starting to pull back. It is expected that steel prices will continue to dominate in the first half of June.
An analysis recently released by the National Development and Reform Commission's Price Monitoring Center predicts that iron ore prices will gradually decline in the third quarter.