In 2011 steel downstream industry outlook
Recently the central leadership has said to continue to strengthen the regulation of the real estate market, last weekend Premier wen said "let house prices have confidence back to reasonable price", Mr Deputy Prime minister also said "to the housing market regulation not shake, restrain speculative investment demand". Thus, in 2011 countries for the housing market in macro-control measures won't ease, at least the existing control policy will continue, and at the same time also can increase the affordable housing construction scale. In addition, the state will also strengthen the management of land, which will promote real estate enterprise to speed up the housing development efforts. The author thinks that, the housing regulation would inhibit building steel demand growing fast, but security room construction and real estate enterprise accelerate development will be stable even houses to improve building steel demand, 2011 real estate investment growth may be good in 2010.
Next year is "1025" planning in the first year, some key areas investment will also pull steel demand. Such as the national will push to change traditional power grid intelligent power grid, 500 billion yuan, the high pressure and 200 billion yuan in rural electric reform is investment key fields, the power equipment of production and power grid construction will increase the demand for steel. In addition, by the high iron and urban subway as a representative of China railway traffic construction also will continue to push forward. "1025" period, China railway investment will achieve 3.5 trillion yuan, estimates an average annual railway construction steel quantity of more than 22 million tons. In addition, the construction of China's urbanization will also drive into steel demand.
Nearly two years of sell like hot cakes in Chinese cars to a certain extent, reduce the building the capacity of steel pressure, but next year's Chinese auto sales are likely would slow down. 2011 not only three countries stimulate consumption policy will cancel the car, and the city of traffic congestion management also inhibit automobile consumption. Such as next year's Beijing is taking a whole wave number, restrict non-local vehicles in Beijing, congestion of the single number management tough measures. Car sales slow may make partial capacity to building steel, increase the building steel supply pressure.
From the perspective of industry, real estate, railway and to help promote the power grid construction steel demand, will set off the car sales growth is slowing the bad influence. Overall see, 2011 steel demand will remain stable.
The second half of 2010, the local government complete energy and emission reduction goals and the launching of the restriction of electricity effects of restricting output measures, make some steel capacity temporarily closed, the inventory decline to the national rebar. At present, these temporarily shut down will resume the capacity of production, the rebar inventory began to rebound. December 24, major cities in China rebar inventory for 4.31144 million tons, compared with a week before, the rebar inventory increase of 144200 tons, an increase of 3.46%. Among them the northeast, east China and south China more inventory increase. Of course, the weather is cold, recent downstream demand weakened stock one of the reasons is rising. Rebar inventory pressure increases to the spot price appear to become loose, parts of the city this week rebar spot price even fall.
Iron ore prices support steel price
Near the end of the year, enterprise funds more nervous, iron ore will purchase is not strong, most of the average steel mill in 2 months inventory maintain or so, has only part of the small and medium-sized steel mills have demand for library. However, the current supply iron ore port is nervous, port YaGang condition is not serious, the businessman rised behavior means that the bullish iron ore prices.
Recent spot iron ore prices rising ore, December 27,, and 63% of the grade of India powder grinding price for us $177 / mt, and according to the higher than $7 / tons; Australia 61.5% of powder grinding grade price is $173 / mt, and according to the higher than $5 / tons; Southern Brazil powder ore prices for us $173 / mt, and according to the higher than $10 / tons. Relative to iron ore prices firm in December, international ocean freight costs less than in November, it shows that iron ore prices is not freight costs rise. Note that the iron ore price is due quarterly agreement over the past three months the average price of the cash, in the first quarter of next year will be lower than the current price of iron ore agreement of the cash ore prices, but will be higher than the fourth quarter of the year the price of the agreement. In the first quarter of next year iron ore prices will remain high operation.
At the same time, the European and American countries have encounter cold weather stimulate international coking coal prices, with the news of shanxi, hebei, henan, domestic all large coal group in the January coking coal prices will continue to rise 100 150 yuan/ton, it will give the coke enterprise to bring greater cost pressure. Expect 2011 iron ore and coking coal prices will push the cost of per ton steel, is expected to cost is 2010 ton to improvement of at least 200 yuan/ton.
To sum up, despite spiraling steel QiJia inventory pressure rise, but steel industry needs remain stable and downstream iron ore prices firm and the formation of QiJia support, so rebar QiJia short-term remain high oscillation, QiJia in 4650 a line has strong support.



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