Experts cooling Black commodity speculation: supply exceeds demand fundamentals have not changed
Supply-side reform affects the nerves commodity market this year, Black hot commodity situation and progress is closely related to productivity.
In response, some industry experts have warned that the 25th meeting of the "2016 China coal mining industry, the General Assembly" on investors, coal iron and steel market, although there have been some positive changes, but the oversupply situation has not fundamentally changed, should be a rational view Price increased.
A typical short-term supply and demand mismatch
After nearly five years after the fall of this year, Black commodity in the steel under the guidance ushered in a wave rally. Shanghai steel joint monitoring data show that the composite price index Mysteel thread began to rebound in 1871 points (17 December 2015) neighborhood, this year April 25, up about 1,200 points, or about 64%; Prices then began to adjust, as threaded composite index is currently 2532 points, nearly 560 points lower than the peak, a decline of 18%.
Coal spot market, Shanxi, Shaanxi, Inner Mongolia and other main origin of the current market price of thermal coal is also the beginning of rise about 90 yuan / ton. Bohai Sea thermal coal price index August 17 464 yuan / ton, than the beginning of the year picked up 92 yuan / ton, an increase of 24.7% over last year picked up 54 yuan / ton, an increase of 13.2%.
Black commodity futures volume and price go, trading is very active. DCE data show that as of July this year, coke, coking coal, iron ore futures trading volume of 0.33 million lots, respectively, 024 million and 241 million hand-hand, an increase of 242%, respectively, 157% and 104%, average daily positions an increase of 54%, 17% and 57%, respectively.
"Composite price index Mysteel thread hit in 2011, the longest time, the biggest rebound, which is typical of the short-term supply and demand mismatch, is supplied to the production side of reform under destocking and results of steady growth." Shanghai Steel Union High analysts Renzhu Qian said.
Moreover, this trend is likely to continue.
Insiders at the meeting said that the current black industry chain are in a state of excess capacity, with the advance of the supply-side reforms, the main varieties of supply and demand will gradually balance. In other words, the supply-side reform will continue to influence the future of coal China Galvalume Steel Sheet
Renzhu Qian predicted by the capacity to influence, in 2016 China's crude steel production will decline slightly, a decline of about 0.2%, about 801 million tons. Coal production will be reduced by 6% year on year, down coke production increased about 5%.
Oversupply situation in the short term is hard to change
Supply-side reform is advancing, Black commodity markets are also able to produce, finance, environmental protection as well as weather and other factors resonance under hot up. In this regard, industry experts called for coal and steel industry chain is not completely get rid of the oversupply, the market should remain calm.
"The market should be rational view of the recent coal price rise." China Coal Industry Association Dong Yue Ying said that the current coal market, although there have been some positive changes, but the coal market oversupply situation has not fundamentally changed.
Dong Yue Ying analysis, the current total coal demand does not increase, the national coal consumption in the first seven months fell 4%, the reason why coal prices rise, mainly because to production capacity, control of production, coal production declined more than the demand. In addition, seasonal factors as well as by the impact of localized flooding.
For the afternoon, Dong Yue Ying believes coal market downward pressure still exists. He said that from the demand, initially expected this year coal demand will decline, which will also reduce electricity demand. From the supply perspective, the current coal industry can progress to total production is still relatively slow. In addition, as coal prices rise, some of the lay-off has been long discontinued small coal mines may return to work, the market remains downward pressure. "With the electricity load dropped late summer tight electricity supply in some areas the situation will become more stable, the price of coal is expected to rise after the recovery will gradually enter a relatively stable stage." Dong Yue Ying said.
For steel, Nanjing Iron & Steel Co., Ltd. Deputy General Manager Xu Lin believes that the Chief of the steel industry to promote the capacity is not easy, it is difficult to reverse the overcapacity situation in the short term. He expects the next steel industry will continue to face cost and demand sides of two squeezed situation. Due to weak demand downstream of traditional processing industry, steel prices difficult to move up, the lack of profitability of the steel industry continued support.
"August steel market consumption in the off-season, the downstream demand flat; 'golden nine silver ten' by rain reconstruction and construction, machinery industry, automotive and other markets increased influence steel demand, steel demand is expected to pick up, but continued decline in shipbuilding and other industries or trend. "Deputy Secretary General of China Iron and steel industry Association, Wang Yingsheng also expressed concerns about downstream demand.
Renzhu Qian believes that real steel consumption this year will continue to weaken, the actual estimated annual domestic consumption of crude steel is about 690 million tons, down 2%. However, given the go productivity, environmental protection, floods and seasonal contraction in the fourth quarter of crude overall yield significantly, steel prices may be lower cost around online fluctuated.