Monthly data:Bearing steel market is expected to be shock in July

Summary: From January to May, the output of domestic bearing steel crude steel decreased by 8.62% year-on-year, and the output of bearing steel decreased by 9.48%. Up to now, the low-cost resources for continuous casting and non-annealing materials in China are 4,500 yuan / ton; the mid-range materials are 4,800 yuan / ton; the high-end materials are 5,600 yuan / ton. It is expected that the market price of bearing steel in July will be strong and volatile.

I. Domestic bearing steel production

1. Production from January to May: Bearing crude steel and steel both fell year on year

According to the statistics of the Special Steel Association, the output of crude steel for bearing steel of the main U-steel enterprises in China from January to May 2019 was 1,565,500 tons, which was 8.62% lower than that of the same period of last year. The main special steel in China from January to May 2019 The output of bearing steel in enterprises was 1,422,900 tons, which was 9.48% lower than the same period of last year. See Figure 1.

2. Production of finished steel products of bearing steel production enterprises from January to May: steel mill output decreased year-on-year

As can be seen from Figure 2, the current bearing steel output is: CITIC Special Steel (Xingcheng Special Steel, Daye Special Steel, Qingdao Iron and Steel), Zhongtian and Giant Energy, accounting for 65% of the total output. In the first half of the year from January to May, the overall output of bearing steel was decreasing. The production of steel mills such as Jianlong, Shigang, Shagang, Nangang, Qilu, Jiyuan, Bengang and Zhongtian decreased. Xinggang, Sugang, Beiman, etc. The output of a few steel mills has increased compared to the same period last year.

Ⅱ.The domestic bearing steel market performance

Looking back at the domestic bearing steel market in June, some mid-end materials have not been adjusted due to the previous price. For example, steel mills such as Nangang, Jiyuan and Juengeng have slightly lowered the transaction price by 50-150 yuan/ton. In the near-term, the demand side performance has weakened, and the traders' shipments are weak. It is expected that the price of the subsequent bearing steel mills will fluctuate strongly.

Ⅲ. Relevant market information

1. Raw material price:

In June, the price of imported ore market showed a strong trend, and the price at the end of the month was 108.73 US dollars / dry ton. The price of ordinary carbon scrap market fluctuated and rose. The average price at the end of the month was 2331 yuan/ton, up by 0.82% from the end of last month. The high-carbon ferrochrome market was weakening, and the average price at the end of the month was 6863 yuan/ton. It is expected that the raw material market price will continue to fluctuate at a high level in July.

2. Downstream industry:

According to the statistical analysis of the China Association of Automobile Manufacturers, in May 2019, automobile production and sales declined slightly from the previous month, and the year-on-year decline was still evident. From January to May, automobile production and sales continued to decline year-on-year, and the decline was slightly larger than that in January-April. In May, the production of automobiles was 1,848,300 units, a decrease of 9.93% from the previous month and a decrease of 21.16% from the same period of last year. The sales volume was 1,192,600 units, a decrease of 3.43% from the previous month and a decrease of 16.40% from the same period last year. From January to May, the production and sales of automobiles were 10.23 million and 10.256 million, down 13.01% and 12.95% year-on-year.

Ⅳ. Conclusion

Looking back at the bearing steel market in June, the market price stopped falling and stabilized, driven by the upward shift in steel mill prices and the strength of the futures market in the next decade. It is expected that the bearing steel market in July will be oscillating and strong.