Recent state of the steel market

Recently, industry indexes are generally in a state of shock decline, and the market recovery trend is disturbed by factors at home and abroad. On the international front, the Federal Reserve interest rate hike landing, monkeypox outbreak; Domestic consumption recovery is relatively slow, the real estate has not seen a significant improvement, the market sentiment is pessimistic. Although the trend of each index is relatively weak, some sectors, such as iron and steel, coal, chemical industry and other procyclical varieties still have a high degree of prosperity recently. With the evolution of the economic cycle and the gradual digestion of pessimism in the market, combined with the acceleration of construction, manufacturing and real estate completion in China in the second half of the year, pro-cyclical products such as steel and coal still have stage opportunities.

Raw materials: Iron ore price rose significantly, inventory bottom rebound, imported iron ore price rose significantly. With the evolution of the economic cycle and the resumption of work and production, the price of imported iron ore has risen significantly. China's imported iron ore price index reported 425.43 on August 1, up 11.52% from last week and down 36.11% from the same period last year. The rise in the price of imported iron ore in the short term shows that steel producers are willing to produce and demand is driving the price

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Iron ore stocks rebounded slightly. Iron ore inventories have been declining since reaching a peak in March this year, and after about four months of digestion, the current overall iron ore inventories have basically fallen to the level of 2019. As of July 29, the port iron ore inventory totaled 135.3455 million tons, up 2.58% month on week, up 5.63% year on year, showing a bottoming out trend.