Monthly data: Bearing Steel Market will be still likely to rise in June

Monthly data: Bearing Steel Market will be still likely to rise in June

Overview: From January to April, domestic bearing steel crude steel output increased by 2.35% year-on-year, and bearing steel output increased by 3.30% year-on-year. Looking back at the bearing steel market in May, the overall market price of GCr15 rose slightly, and the merchant's transaction situation improved slightly, but the increase was not obvious. Up to now, the average price of 50mm (continuous casting) of domestic bearing round steel has increased by 30 yuan/ton to 4710 yuan/ton. From the current point of view, the upward trend of steel mills will not stop in the short term, and it is expected that the price of the bearing steel market will still rise in June.

I. Domestic Bearing Steel Production

1. Production from January to April: Bearing crude steel and steel both rose year-on-year

According to the statistics of the Special Steel Association, the output of crude steel for bearing steel in China's major special steel companies was 1.227 million tons from January to April 2020, an increase of 2.35% from the same period last year; The company's bearing steel output was 1.091 million tons, an increase of 3.30% compared with the same period last year. See Figure 1 for details.

2. From January to April, the output of finished steel of various bearing steel manufacturers: the output of steel mills increased year-on-year

As can be seen from Figure 2, the current bearing steel output is relatively large: CITIC Special Steel (Xingcheng Special Steel, Daye Special Steel, Qingdao Iron and Steel), Zhongtian Steel and Benxi Steel, accounting for 68% of the total output. From January to April in 20 years, the overall output of bearing steels has increased. The output of steel plants such as Jianlong, Beiman, Jiyuan, Benxi Steel, CITIC Special Steel, and Zhongtian have all increased. The output of steel mills such as Jinan and Juneng decreased slightly compared with the same period last year.

Ⅱ.The domestic bearing steel market performance

Looking back at the bearing steel market in May, driven by the upward cost of steel mills and the strengthening of the futures market, the market prices showed an overall upward trend, with most steel mills gaining cumulatively RMB 50-200/ton. It is expected that the bearing steel market will still be likely to rise in June, but the increase is limited.

Ⅲ. Relevant market information

1. Raw material price:

Imported ore prices continued to strengthen in May, with prices at the end of the month at US$101.05 per dry ton. The general carbon scrap market has risen as a whole, with the average price at the end of the month at 2275 yuan/ton. The high-carbon ferrochromium market price is running strongly, up 5.93% from the end of last month, and the average price at the end of the month is 6603 yuan/ton.

2. Downstream industry

According to the statistical analysis of the China Association of Automobile Manufacturers, automobile production and sales reached 2.102 million units and 2.07 million units respectively in April, up 46.6% and 43.5% from the previous month, and up 2.3% and 4.4% from the same period last year. From January to April, automobile production and sales were 5.596 million units and 5.76 million units, down 33.4% and 31.1% year-on-year. Compared with January-March, the decline was narrowed by 11.8 percentage points and 11.3 percentage points.

Ⅳ. Conclusion

Looking back at the bearing steel market in June, driven by the upward cost of steel mills and the strengthening of the futures market in the second half of the year, the overall market price rose slightly. It is expected that the bearing steel market in June may continue to find upward momentum in support.