Under the influence of multiple bad inside and outside, commodities since mid-April, has experienced a wave of more substantial the decline. European debt concerns about making the market to avoid risky assets, while China's economic slowdown investors lowered expectations for economic growth, enhance the market risk premium, the risk of asset valuation decline.

Since mid-April, the thread of the linkage fell. The lowest dropping of the main contract 1210 contracts to 4000 the bottom fell 400 yuan / ton. Subject to recent central bank lowering quasi-rate cut, the National Development and Reform Commission to speed up project approval, market pessimism improvement, rebar of price rebound.

Greek siren temporarily lifted

Since April, the Greek debt problems once again touched the nerve of the market. Concerns to Greece to exit the euro area, making a lot of money into the safe-haven asset, investors risk premium uplift the collective decline in European and American stock markets. At the same time, a lot of money into the dollar-denominated assets to the U.S. dollar soared, which suppress the trend of the commodity.

But with Greece in June 17 elections, the New Democratic Party to win support tightening the tension of the pre-market will be larger ease, the dollar will downlink amended, including commodity pricing of risky assets will be get uplifted. Affected by the late thread futures price also is expected to increase.

Expected to strengthen the end of the domestic policy

With the economic downturn becomes increasingly apparent, the government gradually will focus on the shift to "steady growth" up. In particular, the current level of inflation to the initial control of the situation, the Government has more space "steady growth", in May CPI to drop to 3%.

Has been stressed that "dependable growth on a more important position since May 20, Premier Wen Jiabao research in Wuhan, central government has accelerated the relaxed rhythm of the policy. The central bank has achieved a double down drop prospective interest rate cut; Ministry of Finance introduced the promoting consumption subsidies; the National Development and Reform Commission to speed up the approval of major projects.

Up to now, the policies introduced by the Government can not for the steel substantial demand, the National Development and Reform Commission recently approved project from the preparation to start a longer period of time, short-term and can not bring the consumption of steel the end of the policy has been very clear.

Supply and demand situation is still not optimistic

Be cut from the supply point of view, steel mills, steel prices fell since mid-May, late May, the average daily crude steel production dropped to 1.95 million tons, a decrease of 90,000 tons compared to 2.04 million tons of the highest in early May. However, compared to last year, cut the intensity is still limited, the current level of 1.95 million tons is still higher than the year-earlier levels. In fact, the determination to cut domestic steel mills to lack self-discipline on the current level of profit and loss is questionable.

From the demand perspective, the recent approval of the project is still in the preparatory phase. From past experience, since the project approval, the funds until the start of this process takes about three months time, short-term can not boost demand for steel terminal. By the impact of shipping difficulties, traders on the market outlook is still more pessimistic, intermediate demand is almost zero.

Greece, the problem becomes clearer, the rebar is expected to gradually out of the tail risk, the focus of market transactions is expected to gradually raise the supply and demand may be to some extent, limit of price uplift of space. The author believes that the Greek elections favorable to the rebar the average price rising only 150 yuan / or so. Thread of price trend depends on the improvement of self-supply situation.


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