More news! Market downturn! Steel prices are set for another wave...

According to preliminary data from the Commercial Vehicle Network, in June 2024, China's heavy truck market sold approximately 74,000 units (including exports and new energy vehicles), down 5% from May and 14% from the same month last year, a decrease of about 12,000 units. This figure is only higher than June 2022's sales (55,100 units) and lower than the sales in June of other years.

With the impact of high temperatures in the north and heavy rain in the south, the traditional industry is entering its off-season, resulting in a significant drop in market order volumes, a low morale in the freight market, and overall weak terminal demand.Sluggish market transactions, coupled with lackluster manufacturing data overseas, have impacted heavy truck exports. The overall heavy truck market is experiencing a downturn, reducing steel demand and negatively affecting steel price trends.

National real estate development investment reached 4.0632 trillion yuan from January to May, a year-on-year decrease of 11.1%; residential investment was 3.0824 trillion yuan, down by 11.6%. The construction area of residential buildings for real estate development companies was 68.8896 million square meters, down by 11.6% year-on-year, with the decline rate continuing to widen, and infrastructure investment growth also slowed to 5.7%. The volume of construction steel sold across all provinces in China slightly increased to 149,284 tons, with a daily increase of 22.39%.

Although new real estate policies have been introduced in many places, cities like Beijing have adjusted housing commercial loans with lower down payment ratios and lower interest rate limits, which has somewhat boosted market sentiment and reduced the cost of homeownership for residents.Stimulating the release of essential housing demand, actual transactions remain limited. Additionally, high temperatures in the north and heavy rainfall in many southern regions continue to affect construction progress, leading to weaker demand from downstream sectors. This weakness continues to suppress the rebound of steel prices, negatively impacting the trend.

As of the end of June 2024, the average price of C30 non-pumped concrete on the Centennial Construction Network was 353 yuan per cubic meter, down 0.28% month-on-month. The national concrete prices continued to weaken. In June, the country experienced frequent high temperatures and heavy rains, compounded by the national college entrance examination period, leading to some market construction sites voluntarily shutting down, thus slowing the pace of demand increase. In the East China region, the progress of new residential projects was relatively fast, but from mid-June onwards, the rainfall in Jiangsu, Zhejiang, Shanghai, Anhui, Shandong, and Jiangxi provinces did not subside, resulting in a relatively limited increase in concrete shipment volume.

Parts of the northern regions began to see rainfall in early July, while the south is still in the midst of the plum rain season, causing project progress in various regions to slow down and reducing steel demand.Market real estate and infrastructure investments have weakened, project launches have fallen short of expectations, downstream terminal restocking sentiment is low, and market transactions are weak. Without further macro policy support, this continues to suppress the trend of steel prices, negatively impacting their trajectory.

According to the data from the China Iron and Steel Network APP:

In 24 construction material markets, prices in 13 markets rose by 10-30 yuan/ton. The average price of 20mm HRB400E rebars was 3,596 yuan/ton, up by 7 yuan/ton from the previous trading day.

In 24 hot rolled markets, 11 saw increases of 10-20 yuan/ton, with the average price of 4.75mm hot rolled coil at 3,733 yuan/ton, up 6 yuan/ton from the previous trading day.

In 23 steel plate markets, prices rose by 10-20 yuan/ton in 6 markets. The average price for 14-20mm plain steel plates was 3,775 yuan/ton, up by 2 yuan/ton from the previous trading day.

On the 2nd, the main螺纹钢 in the black series surged 13%, closing at 3,562 with a gain of 0.37%; the main hot rolled coil rose 7%, closing at 3,757 with a gain of 0.19%; the main coking coal surged 29%, closing at 1,612 with a gain of 1.83%; the main coke surged 36.5%, closing at 2,313.5 with a gain of 1.6%; and iron ore rose 12%, closing at 843 with a gain of 1.44%.