Just a few days after the end of a rain and snow in the north, in January and June 2021, the "Overlord" cold wave froze the whole country from north to south. Affected by the cold current, the steel products that should have been released on January 9th and 10th (Saturday and Sunday) The price policy is a few days ahead of schedule. Baosteel Co., Ltd.'s non-oriented silicon steel soared by 1,500 yuan/ton in February, and the oriented silicon steel rose by 200-500 yuan/ton. This premature baby is comparable to Nezha. It comes with three magical objects of the Hot Wheels, Huntian Ling, the Universe Circle. This Hot Wheels burns like a fire in that winter; the Hun Tian Ling stirs up the market and the price hike will sweep China. Thousands of shrimps, soldiers and crabs will smell the wind and move the group of demons; the universe is trapped in the downstream motor and electrical transformer manufacturing enterprises to struggle, just like the third prince of the dragon king being stripped and cramped sooner or later; this heaven and earth aura gave birth to a huge energy Hunyuanzhu, and then by Yuanshi Tianzun Hunyuanzhu is refined into Lingzhu and Magic Pill, and Lingzhu is reborn as a billion-ton steel magic boy. Will it become a fairy? Or become a demon right away? The immortal demon is in a thought, even if millions of the third princes of the dragon king are destined to escape, now the Jade Emperor can't solve this demon boy.
One stone stirs up a thousand waves
Since the Baowu Group’s silicon steel futures price adjustment policy in January 2021, one stone has stirred up waves, and each wave is stronger than one wave. Baowu non-oriented silicon steel rose by 800-1500 yuan/ton, oriented silicon steel rose by 300-600 yuan/ton; then Angang's non-oriented silicon steel rose by 1,400 yuan/ton; Shougang non-oriented silicon steel rose by 900 yuan/ton, and oriented silicon steel rose by 400-600 yuan Yuan/ton; Benxi Iron and Steel's non-oriented silicon steel rose by 800 yuan/ton; Shagang's non-oriented silicon steel rose by 2,200 yuan/ton; it can be said that in this cold winter, a fire is more prosperous than a fire, ushering in the silicon steel field The long-lost "warm winter".
Iron ore prices continue to rise
Since December 2020, the Platts index of iron ore has continuously risen sharply, and reached a peak of US$176.9/ton on December 21, 2020, an increase of 121.7% from the lowest point of US$79.8/ton in 2020. As of the close of 15:00 on January 7, 2021, the latest price of the main iron ore futures contract market: 1062.5, up and down: 31.5, up and down: 3.06%. This round of iron ore price increase has deviated from the fundamentals of demand and has a speculation component. At present, iron ore prices are still high in the short term.
Scrap import ban is lifted
Last week, relevant departments formally formulated new standards, reclassifying scrap steel as "recyclable steel raw materials" and reducing import tariffs to zero.
Soon after the scrap ban was lifted, Baowu Steel and Zhejiang Judong reached two deals, which seemed to be an early "test of the water". Given that the price of the transaction is too high, analysts believe that this does not mean that scrap imports will surge.
At the end of 2018, China began to ban the import of scrap steel to prevent the dumping of global low-grade steel scrap into the Chinese market. This ban will be lifted from January 2021. This does not mean that China will drastically reduce its demand for iron ore. Iron ore will still be the key raw material for steelmaking. Due to the high price of imported scrap and the small scale of the global scrap market, steel mills are unlikely to have the incentive to replace large amounts of imported iron ore with scrap in the short term.
What is the outlook for silicon steel?
The price of non-oriented silicon steel has greatly surpassed the market momentum from 2003 to 2005. From the perspective of the current price adjustment policy of steel mills, the trend of oriented silicon steel in the first half of 2021 is basically clear, and the market for mid-to-high-end grade oriented silicon steel continues to rise steadily. The new energy efficiency upgrade prototype manufacturing of transformers is a market for high-grade oriented silicon steel. Although mass production and manufacturing will have a lag effect, where is the market for large-scale procurement, which will also bring an incremental market to mid-to-high-end silicon steel. GB20052-2020 is equivalent to an urn city, where the turtle is caught in the urn, so it has a positive attitude towards the market outlook. The only risk is that iron ore futures will fall sharply. However, based on the current market conditions, the Hi-B high-end grades of oriented silicon steel will not be affected. If it does happen, the CGO market outlook will be affected a bit at most.
Concluding remarks
CQC31-461212-2020 has officially landed, and transformer energy efficiency upgrades are on the line. The price increase of high-grade oriented silicon steel is a price policy formulated in response to market demand. Coupled with the superimposed factors of the international iron ore futures price rise, the Chinese economy is under epidemic control The subsequent full recovery of the electromechanical industry is the main driving force for the rise of silicon steel. There will be a price adjustment before the Spring Festival. It would be good if the steel mills can consider the Spring Festival holiday and the festive atmosphere not to add to the blockage. If the high grades rise slightly, it will be enough. It saves face, and it is also possible to consider purchasing materials to start production after the festival, which will directly increase the price of medium and high grades. What can you do? Man-made swords and I am fish-meat. Silicon steel, copper, aluminum, iron, plastic, paper, etc. all involve production costs. It is still necessary to make a good corporate procurement plan. After all, every penny that goes up will be pure if it can be saved. profit
If you are interested in our products, please visit www.hkram.com to have more information.