Abstract Yesterday, Baosteel, which is the “wind vane†of steel prices, first released the price policy of March 2013. Its mainstream hot-rolled and cold-rolled varieties rose by 200-300 yuan/ton, and the intensity was significantly higher than before. At this point, Baosteel has raised prices for four consecutive months, the cumulative increase is the most...
Yesterday, as the steel price “wind vaneâ€, Baosteel took the lead in releasing the March 2013 price policy, and its mainstream hot-rolled and cold-rolled varieties rose by 200-300 yuan/ton, which was significantly stronger than before. At this point, Baosteel has raised prices for four consecutive months, with a cumulative increase of more than 500 yuan -570 yuan / ton. The analysis believes that rising costs, sufficient orders and optimistic about the late market prompted Baosteel to raise prices significantly. Baosteel adjusts the pace of price adjustment
The price increase from Baosteel on January 7 raised the ex-factory price in February for only ten days, and the pace of price adjustment accelerated again. In the past, Baosteel generally announced the price adjustment information for the next month in the first half of the month. Since December last year, Baosteel has accumulated a maximum increase of more than 500 yuan -570 yuan / ton, of which the first two are cautiously raised slightly, the range is between 50 yuan -100 yuan / ton, and the two upward adjustments have significantly increased.
Hu Yanping, an analyst at Union Steel, said that Baosteel’s early price adjustment was largely to avoid the Spring Festival factor and to organize contracts in advance. In addition, Baosteel's orders in February were good, and even overbooking occurred, and the traditional peak season after the Spring Festival was 3-4 months. The demand for steel by downstream steel companies will increase, so Baosteel has sufficient base gas to increase sharply.
According to Wang Jinhua, an analyst of my steel network, the market in the previous period has risen sharply, and the price adjustment of Baosteel is relatively conservative.
Push up the risk of steel traders
As a market vane, Baosteel's upward adjustment of steel prices has been interpreted as its optimistic outlook, which has played a role in boosting confidence in the steel market.
Wang Jinhua believes that many merchants in the market before the Spring Festival have been on vacation, this price adjustment or limited impact on the spot market price.
Treasure Island analyst Xu Yongbo told reporters that Baosteel's products are mostly used for automobiles, home appliances, machinery and other plates, and downstream end customers accept strong price increases, but Baosteel's “follow-up effect†caused by industry leaders or some steel traders "Uncomfortable."
“After the price increase of Baosteel in February, WISCO, Anshan Iron and Steel and other steel mills have raised their prices. The current market turnover is not good. If the steel price does not rise after the Spring Festival, the downstream demand does not drive the volume up, then Steel traders can only sell at a loss, so the sharp increase in prices of mainstream steel mills will allow steel traders to accumulate risks and squeeze their profits." Xu Yongbo said.
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