Bearing steel market may end its decline in March
Resource from: CBCC Likes:159
Apr 01,2015
This month, the price of bearing steel continued to dip, mainly down by 50 yuan/ton. Up to now, the price of low-end continuous non-annealed casting material is around 3150 yuan/ton (accepted); mid-range materials 3250 yuan/ton (accepted); high-end materials 4300 yuan/ton (accepted); forgings 5800 yuan/ton (accepted). Many believe that the bearing steel market will may end its decline in March. For one hand, raw materials represented by ore and steel billet are doing well after the Spring Festival holiday; for another, the PMI preview value released by HSBC in February indicates that the economy has signs of stabilization, which will help boost the sluggish steel market.
I. Bearing Steel Markets
1. Output
(i) The outputs of crude steel and bearing steel continued to decline year on year
According to the statistics of Special Steel Association, from January to December 2014, the bearing crude steel output of domestic major steel companies was 2.9271 million tons, with a 2.95% decrease over the same period last year; in the same period, the steel output of domestic major steel companies was 2.8557 million tons, showing a decrease of 2.65% over the same period last year. Wherein, the monthly production of bearing crude steel in December was 220,900 tons; steel production was 216,500 tons. For details, see Figure 1:
(ii) Production scheduling in March: increase or decrease in output
According to a survey on 33 domestic bearing steel production enterprises, the total output of bearing steel in February is estimated at 250,300 tons. Details seen in the table below:
According to the survey, steel stocks rose further during the Spring Festival, resulting sales pressure. Some steel mills cut production to deal with the market situation, but some increased scheduling as they were more optimistic about the market outlook.
2. Bearing steel price in March: dropped by 50 yuan/ton
Bearing steel markets continued the depressed state in March, so market turnover was also light. Steel mills cut the ex-factory price by nearly 50 yuan/ton.
II. Relevant Markets
1. Raw materials market still in the low-price operation
(i) Iron ore
(ii) Steel scrap
(iii) High carbon ferro-chrome
The imported ore index rebounded slightly in February though the whole month average price fell by 7.47% compared with last month; the price of carbon steel scrap continued to fall, and the whole month average price fell by 4.47 % over the previous month; the price of high carbon ferrochrome continued consolidation at the bottom, about 6592 yuan/ton. It is predicted that raw material prices has limited space to fall in March.
2. Downstream markets
(i) Motorcycles
According to the statistical analysis of China Association of Automobile Manufacturers, the output and sales of motorcycles both decreased MoM in January 2015; the output and sales were 1,694,900 sets and 1,679,000 sets, respectively falling by 2.57% and 5.42% YoY, 15.27% and 16.48% MoM.
(ii) Commercial Vehicles
According to the statistical analysis of China Association of Automobile Manufacturers, in January 2015, the passenger cars and trucks of main commercial species showed a decline in both in output and sales compared with the previous month, wherein, passenger cars fell more obviously. In January, the output and sales of passenger cars were 50,100 and 48,700 units respectively, showing a decline of 25.81 % and 30.40 % MoM, and an increase of 24.68% and 8.88% YoY accordingly. For trucks, the output and sales were 267,600 and 232,900 units respectively, showing a decline of 4.32% and 16.54% MoM, and 10.97% and 12.06% YoY accordingly.
III. Conclusions
On the whole, even though the prices of raw materials are still in the downward trend, the decline range has narrowed compared with the previous month. On the other hand, the lowest average price of bearing steel in three years was 4115 yuan/ton which appeared in February 2015, and the current prices were flat compared with that. In other words, market prices are unlikely to fall further. Current market transactions remain poor, which, however, might get improved as downstream enterprises gradually get back to work in March -- the peak season for demand in steel market.
So bearing steel market is expected to end its decline in March.
(ii) Production scheduling in March: increase or decrease in output
According to a survey on 33 domestic bearing steel production enterprises, the total output of bearing steel in February is estimated at 250,300 tons. Details seen in the table below:
According to the survey, steel stocks rose further during the Spring Festival, resulting sales pressure. Some steel mills cut production to deal with the market situation, but some increased scheduling as they were more optimistic about the market outlook.
2. Bearing steel price in March: dropped by 50 yuan/ton
Bearing steel markets continued the depressed state in March, so market turnover was also light. Steel mills cut the ex-factory price by nearly 50 yuan/ton.
II. Relevant Markets
1. Raw materials market still in the low-price operation
(i) Iron ore
(ii) Steel scrap
(iii) High carbon ferro-chrome
The imported ore index rebounded slightly in February though the whole month average price fell by 7.47% compared with last month; the price of carbon steel scrap continued to fall, and the whole month average price fell by 4.47 % over the previous month; the price of high carbon ferrochrome continued consolidation at the bottom, about 6592 yuan/ton. It is predicted that raw material prices has limited space to fall in March.
2. Downstream markets
(i) Motorcycles
According to the statistical analysis of China Association of Automobile Manufacturers, the output and sales of motorcycles both decreased MoM in January 2015; the output and sales were 1,694,900 sets and 1,679,000 sets, respectively falling by 2.57% and 5.42% YoY, 15.27% and 16.48% MoM.
(ii) Commercial Vehicles
According to the statistical analysis of China Association of Automobile Manufacturers, in January 2015, the passenger cars and trucks of main commercial species showed a decline in both in output and sales compared with the previous month, wherein, passenger cars fell more obviously. In January, the output and sales of passenger cars were 50,100 and 48,700 units respectively, showing a decline of 25.81 % and 30.40 % MoM, and an increase of 24.68% and 8.88% YoY accordingly. For trucks, the output and sales were 267,600 and 232,900 units respectively, showing a decline of 4.32% and 16.54% MoM, and 10.97% and 12.06% YoY accordingly.
III. Conclusions
On the whole, even though the prices of raw materials are still in the downward trend, the decline range has narrowed compared with the previous month. On the other hand, the lowest average price of bearing steel in three years was 4115 yuan/ton which appeared in February 2015, and the current prices were flat compared with that. In other words, market prices are unlikely to fall further. Current market transactions remain poor, which, however, might get improved as downstream enterprises gradually get back to work in March -- the peak season for demand in steel market.
So bearing steel market is expected to end its decline in March.
(CBCC)
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1.The news above mentioned with detailed source are from internet.We are trying our best to assure they are accurate ,timely and safe so as to let bearing users and sellers read more related info.However, it doesn't mean we agree with any point of view referred in above contents and we are not responsible for the authenticity. If you want to publish the news,please note the source and you will be legally responsible for the news published.
2.All news edited and translated by us are specially noted the source"CBCC".
3.For investors,please be cautious for all news.We don't bear any damage brought by late and inaccurate news.
4.If the news we published involves copyright of yours,just let us know.
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