Limited space under threaded steel In late June

Tangshan environmental protection restriction measures were introduced to stimulate the threaded steel period price to break through the previous interval pressure platform, on July 1 quickly rushed up to 4148 yuan / ton, with the change of Tangshan production policy began to fall back, currently around 4000 yuan / ton integer level oscillation.

　　The author believes that Tangshan air quality is poor, environmental protection has the possibility of further tightening, and with the arrival of "Golden Nine Silver Ten", demand is expected to rebound after the seasonal off-season, coupled with the high cost of iron ore support, it is expected that the space below the threaded steel is relatively limited, it is recommended that investors pull back to do more. 

　　Environmental restrictions on production are likely to tighten Since late June, environmental storms in Hebei have hit again, especially in Tangshan and Wei. Data show that as of July 12, 62 of the 138 blast furnaces in Tangshan area (excluding long-term shutdowns), an increase of 6 from last week, and a total capacity of 51930m3, an increase of 7270m3 from last week. - Affecting weekly production of about 1.007 million tons, an increase of 187,000 tons from last week, and capacity utilization rate of 62.96 percent, down 6.92 percentage points from the previous week.

Near the 70th anniversary of the founding of New China, the Beijing-Tianjin-Hebei region has the possibility of further tightening of environmental protection, environmental restrictions will make the supply margin slow down. It is understood that the current capacity utilization rate in Tangshan area decreased by a large margin, but the national blast furnace capacity utilization rate and production decline is not strong. Data show that as of July 12, the weekly output of rebar was 3.7552 million tons, down 214,000 tons month-on-month; The daily average iron production was 2.2608 million tons, down 0.79 million tons month-on-month and down 188,000 tons year-on-year. With the gradual deepening of environmental restrictions and seasonal maintenance of steel mills, steel mills are expected to reduce production by the end of August.

Real estate is still resilient in the short term It is reported that the real estate trust business supervision is becoming more and more stringent. On July 6, the CIRC interviewed some trust companies whose real estate trust business grew too fast and increased too much in recent days, and warned them. On July 10, the CBRC convened a meeting of trust companies in the area to further request real estate trust financing. On July 11, the market heard that Everbright Trust and Guotou Taikang Trust suspended real estate trust projects.

　　As the real estate trust supervision policy continues to tighten, the regulatory level for housing does not speculate, curb the bubble attitude is firm and unshakable. Real estate investment and new construction area in June all declined, and the growth rate of commercial housing sales continued to turn negative in the month, down 2.25% YoY. In the long run, the continued decline of the real estate sales side transmission to the weak housing enterprises, and thus drag down the start of new projects, the later steel market demand will also face downward pressure.

　　However, in the short term, new construction closely related to the demand for rebar is still high, the real estate market is still resilient in the short term, and demand for rebar is expected to pick up after the seasonal off-season. 

　　Social inventory is high According to statistics, in the week of July 12, the country's total steel social inventory rebounded to 11.8235 million tons, an increase of 20.28 million tons month-on-month, higher than the same period in the past three years. Among them, the social inventory of rebar was 5.7866 million tons, an increase of 394,000 tons month-on-month, and steel mill inventory was 2.273 million tons, an increase of 428,000 tons month-on-month.

　　The data show that the current low season of demand led to steel inventory continued to climb, which has a certain pressure on the surface of the threaded steel plate. To sum up, with the gradual deepening of environmental protection production, steel production will fall from a high level, demand is expected to rebound after the rainy season, supply and demand will return to dynamic balance. At the same time, short-process steel mills are on the edge of profit and loss and high cost support for iron ore, the space under the threaded steel is limited, it is recommended that investors back to do more. At the same time, we still need to pay attention to the environmental protection is lower than expected, the demand for a sharp decline and other potential risks.

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