Reporter | Wang Yong
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Iron ore prices continued to rise, causing great concern from the National Development and Reform Commission.
WIND data shows that the main contract of iron ore 2205 futures closed at 829 yuan / ton, up 7.59%. The price hit a new high since mid-August 2021 and is up 62% from a nov. 19 low.
The Platts iron ore index also broke through $130/mt again, also reaching a near five-month high, up more than 40% from last November low.
On the evening of the same day, the official micro-post of the National Development and Reform Commission said that the recent sharp rise in the price of iron ore market, during which there were many abnormal fluctuations. Relevant parties believe that the current iron ore market supply and demand is generally stable, domestic inventories are at a high level for many years, and recent prices have risen too quickly, and there is a speculation component.
The National Development and Reform Commission said that it is highly concerned about the changes in the price of the iron ore market, and will conduct in-depth investigations with relevant departments, strengthen supervision, severely crack down on illegal acts such as spreading false information, price gouging, malicious speculation, etc., and study and further take effective measures to effectively ensure the stable operation of iron ore market prices.
In May last year, the main iron ore futures contract broke through the high point of 1200 yuan / ton. Subsequently, the domestic steel industry limited production led to a sharp drop in demand, and iron ore prices began to fall. Since November, it has been rising again.
On January 28, Baotou Steel Co., Ltd. (600010.SH) said on the interactive platform that iron ore has recently risen by a certain extent, which has put some pressure on its steel costs.
The rise in iron ore prices is basically consistent with the trend of steel mills resuming production. Wang Guoqing, director of Lange Iron and Steel Research Center, pointed out that since December 2021, with the completion of the task of pressing production in various places, the resumption of production of steel companies has increased, the operating rate has continued to rise, and steel production has rebounded significantly from the previous month.
In January 2022, under the continuous release of national stable growth signals and policies, "strong expectations, weak reality" superimposed raw material prices were firm, and steel prices stabilized and rebounded. Superimposed on the recent pre-holiday replenishment of steel mills, the demand for iron ore has increased, and ore prices have continued to rise.
As of the close of trading on January 28, the main contract of rebar 2205 futures closed at 4829 yuan / ton, up 2.83%, up about 30% from the November low.
For the iron ore market, Lange Steel said that the current steel mill replenishment is basically over, and due to rising costs, steel mill profits shrink, and there is uncertainty about whether steel consumption can improve as scheduled.
Lange Steel said that the blast furnace operating rate has fallen this week. With the approaching of the Winter Olympics, Tangshan's production restrictions are becoming stricter, the demand improvement space is limited, and the price of iron ore after the holiday is easy to be under pressure, and it may be difficult to continue.
A few days ago, the three major mines announced the 2022 iron ore production guidance targets, all of which have increased compared with 2021, ranging from 2 million to 10 million tons.
Among them, BHP Billiton's target guidance for iron ore in fiscal year 2022 (July 2021 to June 2022) is 278 million to 288 million tons.
Rio Tinto Pilbara iron ore production targets 320 million to 335 million tonnes in 2022 due to expected demand improvement.
After taking into account seasonal impacts such as rainfall for all operations, Vale maintained its 2022 iron ore production guidance target at 320 million to 335 million tonnes.
Boseong Futures pointed out that the recent arrival and shipment of domestic iron ore have declined, but it is worth noting that the shipment of non-Australian and Pakistani mines has recently rebounded, and domestic mines are also resuming production against seasonality.
This week, Mysteel counted the total inventory of iron ore imported by steel mills nationwide about 117.5757 million tons, an increase of 470,200 tons from the previous month.
For the steel market, Ge Xin, deputy director of Lange Steel Research Center, said that the market has entered a state of suspension, demand has almost stagnated, market transactions are cold, and social inventory and steel mill inventory have entered the stage of synchronous accumulation.
Due to the impact of the spring holiday and the Winter Olympics, steel mills began to increase their active production reduction and maintenance, the blast furnace operating rate also began to decline, the recovery process of the supply side began to come to an end, the price of raw materials was loosened, but in the short term it was still at a relatively high level, and the bottom support of the steel market was still strong.
At the same time, due to the recent introduction of stable growth policies and measures, the market has strong expectations for economic growth, which has also made some merchants start to launch the active "winter storage" plan. The existence of passive "winter storage" and the activation of active "winter storage" will prompt the post-holiday steel market to usher in a "good start".
At present, the inventory of steel enterprises is on the rise. According to the statistics of the China Steel Association, in mid-January, the steel inventory of key enterprises was 13.15 million tons, an increase of 16.4% over the end of last month.