Investment Rating - The industry investment rating is Neutral, maintained [6]. Core Insights - The steel industry has experienced a significant increase in molten iron production, while the inventory of five major steel products has been reduced, indicating improved demand year-on-year. However, this is contradicted by declining steel prices and feedback from steel companies regarding average order quality [2][4]. - The report highlights the paradox of high molten iron production amidst declining demand, suggesting that understanding the production process and statistical measures is crucial to explain this discrepancy [4][8]. Summary by Sections Demand and Supply Dynamics - Demand has fluctuated due to holiday effects, with a notable decrease in apparent consumption of the five major steel products, down 10.75% year-on-year and 14.69% month-on-month. Average daily transaction volume for construction steel decreased to 102,700 tons, a drop of 960 tons per day compared to the previous week [4]. - Molten iron production continues to rise, with average daily production reaching 2.4564 million tons, an increase of 0.22 tons per day month-on-month. The production of five major steel products decreased by 0.89% year-on-year and 1.27% month-on-month [4][8]. - Total steel inventory has shifted to accumulation due to a significant drop in demand, increasing by 2.18% month-on-month. Long product inventory decreased by 18.07% year-on-year, while plate inventory decreased by 14.00% year-on-year [4][8]. Production Insights - The average daily molten iron production from 247 sample steel companies is 2.3336 million tons, a year-on-year increase of 4.2%. The weekly average apparent consumption of five major steel products is 10.82 million tons, nearly unchanged year-on-year [4][8]. - The report notes that the marginal substitution of molten iron for scrap steel has become more pronounced due to a significant drop in metallurgical coke prices, leading to increased molten iron input by steel companies [8]. Market Trends - The report indicates that steel billet exports have significantly increased due to domestic steel price declines and limited overseas import restrictions, with exports reaching 2.56 million tons in the first three months, a year-on-year increase of 200 million tons [8]. - The supply of non-mainstream steel products has increased by 10.6% to match crude steel growth, despite challenges in achieving a 10% demand growth rate for these products [8]. Investment Opportunities - The report suggests focusing on undervalued quality state-owned enterprises such as Baosteel and Nanjing Steel, as well as companies with strong shareholder returns like CITIC Special Steel. It also highlights the potential of mergers and acquisitions in the sector [24].
高位运行的铁水去哪儿了?
Changjiang Securities·2025-05-11 14:15