Iron ore rises? not that simple.....
In recent days, warnings of severely polluted weather have been lifted or downgraded, and steel demand has weakened relatively during the off-season of traditional demand, and downward pressure on rebar has gradually increased. As the profit of steelmaking blast furnace smelting falls to a reasonable range of 300-500 yuan / ton, the power of steel mill replenishment demand weakens, which is a drag on the trend of iron ore, and it is expected that there is limited room for the rise of iron ore.
Australia and Pakistan reduce shipments and reduce transportation costs. < Br 消息 In the second half of this year, news of resumption of production in Brazil's mining areas continued to appear. On the evening of June 19, Vale of Brazil announced that the remaining 20 million tons of wet processing capacity at the Brucutu mining area may be in 72 hours. Resumption of production; on July 24, Brazil's National Mining Agency allowed Vale to resume dry-dressing production at the Vargem Grande iron mine; on November 1, Brazilian regulator ANM approved the restoration of the operation of the Alegria mine. The news of the resumption of production in these major mining areas has caused the disk to fall or accelerate its decline. It is expected that the resumption of production in other mining areas in Brazil will also suppress the price of the disk.
In terms of specific data, due to the completion of the overhaul of the mine berths in the first week of December, the shipment volume of Macao and Pakistan began to rise sharply to 22.147 million tons, and the pressure on the supply side was prominent; 10,000 tons. In terms of different mines, among the three major mines in Australia, Rio Tinto and BHP mines have experienced new maintenance, and their shipments have all declined. FMG mines have fluctuated within a narrow range and no year-end impulse has been seen. In Brazil, VALE mines Less maintenance, and overall shipments picked up. Overall, it is expected that the short-term Australian and Pakistani shipments may continue to decrease slightly, which will support the market.
The price collected by the Platts index is the CFR (cost + freight) spot price of iron ore in China's main ports, and its trend is highly related to the trend of the main iron ore contract. Since December, the Platts index has fallen from $ 94.35 / dry ton to $ 89.7 / dry ton. Further analysis, Brazil-China iron ore transportation costs account for about 20% of the iron ore CFR, and Australia-China transportation costs account for about 10% of the iron ore CFR.
Specifically, the iron ore freight in Tubarao-Qingdao, Brazil decreased from US $ 22.6 / ton in early December to 19 $ / ton; the iron ore freight in Western Australia-Qingdao also decreased from US $ 10.7 / ton in early December to USD 7.6 / ton. In December, the center of gravity of the freight cost of iron ore moved downwards, driving the Platts index down, and the transportation supply of iron ore may increase, which will have a certain pressure on the rise of the iron ore market.
Blast furnace steelmaking profits fell from November to mid-December, and the average daily port sparse port operation was at a high level of more than 3 million tons. During this period, demand for iron ore was strong, driven by the high profit of steelmaking blast furnaces. However, the daily average sparse port volume on Dec. 20 fell sharply from a high of 465,700 tons to 2,714,400 tons, which was close to the level of the same period last year. The decrease in the daily average port sparse data is due to the closure of the two ports in Tangshan on the one hand, and also a sign of weakening demand from steel mills.
The latest data on December 27 showed that the blast furnace operating rate of 247 steel plants nationwide was 76.89%, a drop of 0.93 percentage points from the previous month. The total daily consumption of sintered ore was 531,700 tons, which was a decrease of 39,400 tons from the previous month, a two-week decline. In addition, before the Spring Festival is also an intensive period of steel plant maintenance, it is expected that short-term iron ore demand will have little room for improvement.
According to calculations, the rebar blast furnace production cost climbed from 3,330 yuan / ton at the end of November to 3,437 yuan / ton, and then dropped to around 3,330 yuan / ton. However, as spot prices in the building materials market continued to fall, blast furnace steelmaking profits also fell from 800 yuan / ton at the end of November to the current 400 yuan / ton. Blast furnace steelmaking profits have fallen sharply, the replenishment power of steel mills in the early stage has weakened, and iron ore port inventory continues to accumulate. Data on December 27 showed that iron ore port inventory rose by 24,900 tons to 126.95 million tons, reaching a new high since November.
In terms of absolute iron ore stocks in steel mills, the sintered ore stocks at steel mills on December 27 reached 18.43 million tons, rising for six consecutive weeks, a year-on-year high, and a new high since February this year. It can be seen that after the steel plant replenishment is expected to be fully fulfilled since November, the impact of rising iron ore stocks in the steel plant on the disk has been reduced in the past two weeks, and the power of the previous steel plant replenishment operation to support the rise of iron ore has weakened. At the same time, with the current smelting profit of the steel plant's blast furnace down to 400 yuan / ton, it is expected that the steel mill's space for iron ore replenishment operations may be limited.
Judging from the relative inventory of iron ore in steel mills, the available days of imported ore inventory increased by 5 days to 32 days, rising to a high of nearly two months. The available days of imported ore inventory is a key indicator of the combination of iron ore inventory and the strength of procurement demand. When the available days of imported ore inventory is relatively high, the enthusiasm of steel mills for procurement will be weakened.
Rebar community warehouses and factory warehouses continue to accumulate <br /> Tangshan Guye District has lifted heavy pollution weather level II emergency response since December 26; Linfen City, Shanxi Province has decided to start heavy pollution from zero on December 26 The weather red warning was downgraded to orange warning; Tianjin City ended the emergency response to severely polluted weather from 20:00 on December 25th. The cancellation or downgrade of severely polluted weather warnings in many places in the north is bad news for the blacks and will also drag the overall blacks up.
In recent years, the rebar inventory situation has shown significant cyclical characteristics. From December to February, the rebar inventory has accumulated significantly. In the case of strong steel terminal demand, the rebar social inventory and steel mill inventory in November continued the downward trend in October and fell to a low area in the past three years. On December 25, the social inventory was 28.324 million tons, and the rebar mill inventory was 1.896 million tons. In the early stage, due to environmental protection and limited production in Hebei and Shandong, the proportion of short-term inspections increased, and the decline in output expanded. In recent days, warnings of severely polluted weather have been lifted or downgraded, and short inspections at several steel mills have ended, and production has gradually recovered. It is expected that rebar stocks will continue to accumulate, which will curb steel prices to a certain extent.
The purchase volume of Shanghai snails has fallen , and the PMI was announced soon in December. In November this year, the PMI index was 50.2%, which was above the line of prosperity and dryness, and was 0.9 percentage points higher than that in October, higher than expected. The November PMI index is generally the highest performing month in the fourth quarter, and it is expected that it will fall in December, driving the black line downward.
From January to November 2019, the investment in real estate development nationwide was 12,126.5 billion yuan, a year-on-year increase of 10.2%, a growth rate of 0.1 percentage point lower than that in January-October; the floor space of real estate development companies' construction area was 8.741814 million square meters, a year-on-year increase of 8.7% Compared with the period from January to October, it decreased by 0.3 percentage point; the floor space of newly started housing was 2,051.94 million square meters, an increase of 8.6%, and the growth rate dropped by 1.4 percentage points. From January to November 2019, infrastructure investment (excluding electricity, heat, gas and water production and supply) increased by 4.0% year-on-year, and the growth rate dropped by 0.2 percentage points from January to October.
It can be seen that the main indicators on real estate and infrastructure data released in December have all fallen back. From January to February next year, the macro data is in a vacuum period. The macro data in March is expected to be weak, which will guide the short-term black system to weaken. In terms of real estate, under the general tone of "do not live in real estate," real estate is expected to decline moderately; in terms of infrastructure, the investment base for infrastructure investment is low at the beginning of the year, and the role of special debt will be very obvious, but it is still doubtful to what extent .
As the weather in the northern region becomes colder and the demand gradually weakens, the resources in the north may flow into the eastern and southern markets, and the tight supply of building materials in the southern region will be changed, which will cause prices to fall. Looking at the specific data, the purchase volume of Shanghai Line Spiral Week on December 20 was 23,900 tons, a drop of 5.53% month-on-month, and fell for four consecutive weeks. Under the traditional low season of steel demand in January next year, it is expected that the purchase of Shanghai Line Spiral Week will continue Falling space.
Basis of iron ore main contract keeps stable <br /> Based on Qingdao Port PB powder as spot benchmark and 0.92 as wet / dry ton conversion factor, the basis of iron ore main contract is currently stable at 75-90 yuan / Between tons. On December 26, the PB powder of Qingdao Port was 659 yuan / ton, the closing price of the main iron ore contract was 639.5 yuan / ton, and the basis difference was 76.8 yuan / ton. As of December 26, the maximum basis difference for the main iron ore contract this year was 230.1 yuan / ton, the minimum value was 9.5 yuan / ton, and the average was 97.3 yuan / ton. At present, the basis is at a low level in the middle. In the case of the slow decline in the spot price of the port, the short-term rise in the market is also suppressed.
Taking the rebar HRB400 20mm Shanghai area as the spot benchmark and 0.97 as the pound difference conversion factor, the base difference of the main rebar contract decreased from 600 yuan / ton in early December to 285 yuan / ton. On December 26, the Shanghai rebar HRB400 20mm was quoted at 3700 yuan / ton, the main rebar contract was 3529 yuan / ton, and the basis difference was 285.4 yuan / ton. From a statistical point of view, as of December 26, the maximum basis difference of the main rebar contract this year was 709.4 yuan / ton, the minimum value was 62.8 yuan / ton, and the average was 346.8 yuan / ton. At present, the basis is at a low level in the middle. As the price of building materials continues to decline, the superposition is driven by the weakening of steel fundamentals. It is expected that the short-term market will also weaken. (Author Unit: Funeng Futures )
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