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Domestic steel prices are still too far-fetched based on rev

6 Reinfonced City 应属 season began, but after the Dragon Boat Festival, with the domestic steel, higher prices for iron ore, steel prices should trend higher, some cities and even reluctant to sell the case closed libraries, greatly exceeds the market expected; however, the rebound in steel prices, while businesses in general feedback terminal demand remains weak, so this rally has been attributed to the steel man pull up, attracting onlookers approach stockpile trick. In fact, after a few months the overall decline in steel prices, steel prices fell because the number of varieties low in recent years, the stock market is indeed significant decline in the cost constraints, the majority of post-market businesses that continue to fall sharply with very limited space, steel is in the bottom of the shock process may occur at any real end. But the message on the upstream steel production, the supply pressure has not eased, according to steel reverse too far-fetched, hunters prices unsustainable.
First, unresolved contradiction between supply and demand, steel prices remain low and criticized Chinas steel industry are inseparable, CISA statistics of key enterprises in early June crude steel output to 1.731 million tons, late growth of 1.3%. From the point of view of steel prices in the thread, for example, market prices continued upside down, although this year the social stock losing streak thirteen weeks, now stands at 7.84 million tons, compared with last year, but this data is still at a high level compared; while steel How can the prices are expected to fall frequently turn down conduction to the market, so I question the steel city market oversupply market reversal? With the arrival of summer, hot days of outdoor work will be affected, the release of a further slowdown in demand, which possible to make a continuous decline in social stocks appear repeatedly, can limit production cuts in place, focusing on the Government to implement.
Secondly, funding problems, a large state-owned banks and private banks on the central economic policy "optimistic misreading" lead to indiscriminate lending, bank lending rate hit a high of 15 percent, while the central bank and the State Department made it clear that it would not inject liquidity Policy "rescue" resolutely implement the process of market interest rates; while June is the size of loan and deposit appraisal point of commercial banks in the second quarter, resulting in short-term deposits punch-scale market funds more scarce, the inevitable rise in the cost of capital; together by the end of June 7 it happens to be the beginning of the reserve contributions and financial contributions point, to some extent, the closing will exacerbate the shortage of money market liquidity, the "money shortage" to be extended to at least the beginning of July. Which may result in a two-way tension steel funding; hand downstream industry in the case of insufficient funds itself the ability to return the banks credit crunch will further restrict the progress of the project financing, in short, there are orders, but no cash flow; Another aspect is the iron and steel industry, the companys internal financial strain, especially at the end of the steel trade mills required to play money, there is a strong pressure to return the funds, which is extremely unfavorable for steel prices.
Overall, if no major country to implement good policies, the steel industry as a whole toward the stage is difficult to change the pattern of weakness, imbalance between supply and demand, profit compression, pressure, etc. will continue Forced credit strength of small businesses were merged, exit, this summer is very cold!