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304L stainless steel seamless pipes under weak demand will be the focus of future market attention
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Changes in the supply side of 304L Stainless Steel Pipe seamless under weak demand will be the focus of future market attention
The production of steel mills is first inspected on a large scale before resuming production on a small scale. Steel mills are playing a game in the cycle of resuming production, reducing production, and resuming production. Without a significant improvement in profits, the possibility of a significant increase in production is unlikely. There are also rumors in the market that the detailed control rules for crude steel have been promoted to various steel mills, but there has been no clear official confirmation yet. The apparent demand has slightly increased due to a low base, Steel mills and market agents still maintain the operation of removing and lowering inventory, and the overall inventory of 304L stainless steel seamless pipes is still in a rapid downward trend.
Continuous fermentation with negative feedback at the raw material end
Fundamentals: Downstream demand and prices are not optimistic, the profit of 304L stainless steel seamless pipe factory has deteriorated, and the gross profit margin of coke steel is 4.6%. Driven by profit, there is a downward trend in spot goods, and it is difficult to sustain production resumption; The cost has stabilized, the eleventh round of coke price reduction has been implemented, and the profit per ton of coke has slightly decreased. Shipping has improved, but there is a slight resistance to price reduction. The coke steel production ratio has decreased, and negative feedback from the raw material end continues to ferment. Before the raw material stabilizes, prices continue to decline.
There are three key points in the May PMI data. Firstly, the manufacturing PMI continues to decline, affecting both production and demand; Secondly, the PMI indicators for non manufacturing industries are still in the high prosperity range, but the growth rate has slowed down, and the recovery of the service industry has shown some differentiation, mainly due to the impact of the real estate downturn; The third reason is that price indicators have rapidly declined, and the survival situation of small and medium-sized enterprises is not optimistic. In fact, all of these reflect a problem of insufficient domestic demand, and the effectiveness of current economic stimulus policies has gradually weakened. The lack of domestic demand is already a consensus, but there are significant differences among various parties on how to stimulate domestic demand. One is to stimulate the economy by releasing water. Previously, the market had high expectations for interest rate cuts, but currently, interest rate cuts cannot solve the current problem. The large amount of currency released in the first quarter is mainly concentrated in the hands of enterprises, and currently residents are still in the process of deleveraging. The second is to increase efforts to stimulate real estate and once again play its role in stabilizing the economy. But currently, residents are still in the process of deleveraging, and stimulating real estate cannot solve the problem either.
At present, there is a significant seasonal pressure on the demand side of 304L stainless steel seamless pipes, with some regions experiencing heavy rainfall, which affects the progress of construction, and the terminal demand continues to weaken. On the supply side, there are rumors in the 304L stainless steel seamless pipe market that the rough steel level control regulations have been promoted to various steel mills, but there has been no clear official confirmation yet. The changes in the supply side of 304L stainless steel seamless pipes under weak demand will be the focus of future market attention. Since May, various rumors have emerged one after another, but without significant positive macroeconomic and industrial policies, the rebound will still be limited.
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