Trend of China’s domestic steel market in November

The decisive implementation of the package of incremental policies in September fully demonstrates China’s determination, strategy, and methods to maximize policy effects. Currently, the country will accelerate the implementation of the package of incremental policies and existing policies, form a policy synergy, consolidate the stabilizing and rebounding trend of the economy, and continue to promote economic growth, structural optimization, and development.

National leaders have repeatedly emphasized that all regions and departments should conscientiously implement a series of major measures determined by the Central Political Bureau meeting, implement various stock policies and incremental policies in place, play a combination of punches, effectively carry out various work in the next two months, and strive to achieve the annual economic and social development goals and tasks. At present, the seamless steel pipe and other steel markets are greatly affected by policies, and the market risks are not significant in early November as policies pave the way.

At present, the supply-demand contradiction of domestic pipes, plates and other materials has increased. However, after this wave of decline, the profit of steel varieties has been squeezed again, and some steel mills have quickly switched to production. Against the background of no further expansion of ton steel profit, the upstream supply pressure of steel in November will weaken. Although we are concerned about the impact of seasonal factors, there is no need to be overly pessimistic. The demand for steel in the manufacturing industry has performed well, and the sales of new and second-hand houses in first tier cities have also rebounded. With policy support, there may not be a significant decline in domestic steel demand in November.

Overall, the peak season is based on demand, while the off-season is based on speculation expectations. The current logic of steel prices still follows the expected reversal logic, and the impact of supply and demand fundamentals is not as strong as policy support. Under the expectation of strong policy paving, it is expected that the domestic steel market prices will fluctuate and rise in November, but the height may be limited.