Predict steel prices will welcome the "opener" shock upstream

After the Spring Festival, the spot market price of steel in the optimistic expectations, rising costs, the relative stability of supply and demand, and the "opener" after the holiday, mainly to shock operation, a slight upward trend. The main reasons are the following:

First, the current price is neither high nor low. The current spot price is neither high nor high, but it is low. After all, it is rising from the bottom. There is an increase of about 400 yuan. In such a relatively off-season period of supply and demand, everyone does not dare to pull up. Consolidation for a period of time is conducive to better upward movement. In the context of the lack of actual demand increase, it is very important to build confidence.

Second, the price of raw materials tends to rise and fall. On January 18, MYSTEEL's statistical iron ore port inventory was at a low level of nearly two years, reaching 70.65 million tons. In particular, Australian weather affects iron ore and other shipments at any time, and it still has an impact on post-holiday supply and demand. Coupled with the arrival of the Spring Festival, some steel mills also need to prepare raw materials, and once the Spring Festival holiday is over, there are steel mills to purchase.

Again, the cost pushes up steel prices. The main reasons are:

The first is that steel mills are increasingly using high-priced mines purchased in the previous period, and the cost is rising;

Second, under the general expectation that steel prices will rise after a short period of time in the future, as long as the short-term spot market does not exhibit a clear downward pattern, raw material prices will not fall, and the cost will be able to support steel prices. Steel mills generally do not choose to lower prices. ;

Thirdly, the steel mills that have been on the edge of the long-term profit and loss situation have generally expected that the price of steel will rise after a short period of time in the future. This also encourages companies to choose not to lower their prices. If the price of newly purchased raw materials is increased in the future, it is more likely to choose a new price increase. Policies, such as Baosteel, came up with a price policy of RMB 100~300/ton in March on January 22.

Fourth, the current upside down of the steel factory price and spot market price is not obvious or even upside down;

Fifth, the downstream orders from the steel mills are not bad. Traders have increased their stocks and stocks are not high compared to the same period last year.

Also, from the perspective of probability, there is a high probability of increase. In 2001~2012, the steel price in February, only fell in 2009, the probability of rising up to 92%. Although the probability of a "good start" is high after the Spring Festival, the actual demand hasn't caught up with it in the meantime. Adjustments have occurred in most years. However, there may be some differences in 2013. As everyone is generally expected to post bullish in the later period, even if there is a drop, it may be smaller in magnitude, not long in time, and even not rule out directly after the shock. From the trend of 2001 to 2012, the probability of rising steel prices reached 91% in the month after the Spring Festival, and it rose in 10 years in 12 years. This year's Spring Festival time is about the same as that of 2005, and both years have come out of a certain rally.

In addition, the international market may also drive domestic steel prices upward. The leading indicator of international trade and economy, BDI, has continued to rise recently. Japan has announced the implementation of an unlimited-scale easing policy. The United States has also continued to adhere to easing policies, and signs of recovery in real estate and other industries have become more pronounced. International steel prices have continued to rise, which is conducive to exports. And drive domestic steel prices up.

Of course, the author also noticed some factors that may cause price weakness in the market. For example, crude steel production is still high, funds are still tight, stocks after the Spring Festival increase significantly, demand is not released, confidence may not come, and so on. .

Overall, after the Spring Festival, the spot market for steel products will show uptrend and uptrend under optimistic expectations and rising costs. The period 1305 contract, under 4000 can choose to build a phased strategy more than one.