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Raw material price continues to rise trend steel prices rally
May 25, 2017

First, the prices of raw materials continue to rise.

Second, the new deal led to a large increase in freight transport. After the coking steel market can continue to rally, but also face a lot of uncertainties.

The first is the steel market supply increase, inventory growth, steel industry to production capacity is not smooth, coupled with earlier steel prices rose, profitability improved, steel production faster, according to CISA data estimate, September mid-June national crude steel Nissan 2.3191 million tons, the chain growth 0.58%. By the end of September, the key steel Enterprises steel inventory of 14.1936 million tons, the chain increased 3.22%;

Second, the government to release the pace of advanced coal production capacity, due to the market main concern for the cold winter shortage of coal, restocking demand is still strong, price expectations strong, the government in order to balance supply and demand, curb the phenomenon of coal market speculation, phased increase control efforts to break through the existing three-level contingency plan, the daily new coal production will exceed 1 million tons, taking into account the lag of policy implementation, the coal price after or cooling; Finally, the New Deal of transport, the news that Tangshan temporarily no longer carry out the new deal Truck load restored to September 21 before the new deal. If the news is true, the restrictions on transportation in other areas are likely to follow.

In addition, the entire basic face of the demand for coal char is not significantly improved, coupled with the late October northern parts of the cold, project downtime, steel demand fall back inevitable. Therefore, it is expected that steel prices will continue to adjust in the short term, coke, coking coal price rally moderated.