Group 1 - The China Iron and Steel Association emphasizes the need for domestic mining companies to accelerate key iron ore project advancements and achieve high-quality project goals [1] - The association will dynamically update the list of key iron ore projects and conduct research to understand the real situation of these projects, while also enhancing resource security capabilities in the steel industry [1] - Guotai Junan Securities forecasts that steel demand is expected to stabilize, with supply remaining constrained, as the negative impact of real estate on steel demand diminishes and demand from infrastructure and manufacturing is anticipated to grow steadily [1] Group 2 - Cinda Securities acknowledges that despite the current supply-demand contradictions and declining industry profits, steel demand is expected to remain stable or slightly increase due to supportive policies and steady growth in real estate, infrastructure investment, and manufacturing [2] - The overall supply-demand situation in the steel industry is expected to remain stable, with tightening supply and increasing industry concentration [2] - The future steel industry landscape is projected to improve, with structural investment opportunities available, particularly for high-margin special steel companies and leading steel enterprises with strong cost control and scale effects [2]

Core Viewpoint - The China Iron and Steel Association emphasizes the need for domestic mining enterprises to accelerate key iron ore project development and achieve high-quality project goals [1] Group 1: Industry Initiatives - The association will dynamically update the list of key iron ore projects and systematically address common issues faced by enterprises [1] - Research will be conducted in key regions to understand the real situation of projects, with timely feedback to relevant ministries [1] - The association plans to enhance efforts in stabilizing domestic iron ore operations and promoting supply-side structural reforms in the steel industry [1] Group 2: Resource Assurance - Multiple measures will be taken to actively improve the resource assurance capability and level of the steel industry [1]

Report Summary 1. Report Industry Investment Rating - Not provided in the report 2. Core Viewpoints of the Report - This week, the futures market was affected by rising raw material prices, causing finished products to follow suit, but the increase was weak due to lack of demand improvement and negative trading sentiment [2] - According to Steel Union data, the blast furnace operating rate rose 0.15% to 83.98% week - on - week, while the steel mill profitability dropped 1.30% to 58.87%. The production profit of hot - rolled coils was relatively good, so steel mills would adjust production. The weekly output of hot - rolled coils in China increased by 1.35 million tons to 3.2649 billion tons, and the total inventory of five major products decreased by 1.78 million tons to 15.1974 billion tons. The inventory of hot - rolled coils increased by 4.67 million tons, and demand decreased by 4.34 million tons to 3.2182 billion tons, suppressing the rise of spot prices [2] 3. Summary by Relevant Catalogs 3.1 Futures Market - **Contract Price**: The hot - rolled coil futures price showed a state of rising first, then falling, and finally closing slightly higher. The upward trend was difficult, indicating weak market bullish sentiment [3] - **Variety Market**: As of September 19, the opening price of the HC2601 main contract of hot - rolled coils was 3361 yuan/ton, the closing price was 3374 yuan/ton, the highest price was 3417 yuan/ton, the lowest was 3339 yuan/ton, and it rose 10 yuan/ton this week [6] 3.2 Spot Market - **Spot Market Conditions**: The average price of Q235B 4.75mm hot - rolled coils in major Chinese cities was 3407 yuan/ton, down 3 yuan/ton week - on - week. The spot profit was 150 yuan/ton, up 26 yuan/ton. The weekly average trading volume decreased 6.1% week - on - week, but Friday's restocking led to a high - volume trading day [7] - **Basis Data**: The basis between Shanghai hot - rolled coil spot and the futures main contract was 46 yuan/ton, and the regional price difference between East China and North China narrowed by 10 yuan/ton to 60 yuan/ton, with weak motivation for northern steel to move south [10] 3.3 Influencing Factors - **Industry News**: The spokesperson of the Ministry of Industry and Information Technology said that it would continue to promote supply - side structural reform in the steel industry and ban new production capacity, with a neutral short - term impact on the market [11] - **Technical Analysis**: For the HC2601 contract, the daily MACD indicator showed that the upward momentum was weakening, the RSI (14 - day) entered the neutral range, and the Bollinger Bands formed a current trading range of 3350 - 3400 yuan/ton [12] 3.4 Market Outlook - From September 15 - 19, the hot - rolled coil futures main contract showed a state of "range - bound trading and long - short game". The core contradiction was the imbalance between high supply and weak demand. In the short term, the hot - rolled coil futures may maintain range - bound trading, and attention should be paid to pre - holiday restocking progress and marginal improvement signals in manufacturing demand [13]

Report Summary 1) Report Industry Investment Rating No information provided. 2) Core Viewpoints of the Report - Steel and iron ore futures prices may fluctuate strongly due to the mitigation of off - season adverse factors, supply pressure, and limited inventory pressure [1][53][55]. - For steel, despite the pressure on macro - economic indicators in July, the end - demand may improve marginally, and supply may be under pressure, so steel futures prices may fluctuate strongly. For iron ore, although demand may be under marginal pressure, it still has resilience, and supply is marginally tight, so iron ore futures prices may also fluctuate strongly [2][3][53][55]. 3) Summary by Relevant Catalogs I. Supply - demand marginally loose and "anti - involution" policy with expected difference, steel and iron ore futures prices fluctuate downwards - Last week, the futures prices of steel and iron ore main contracts fluctuated downwards. The prices of rebar, hot - rolled coil, and iron ore main contracts fell by 2.16%, 2.27%, and 0.77% respectively. The macro - economic data in July showed pressure on the economy, and the supply of steel and iron ore increased significantly, with off - season factors still affecting, resulting in a marginally loose supply - demand situation. Also, the "anti - involution" policy implementation is market - based, and the short - term implementation may fall through, suppressing the bullish sentiment [6]. II. Steel supply - demand marginally tight, iron ore supply under pressure and demand with resilience, the pressure of inventory accumulation for steel and iron ore may be limited (1) Steel: Supply under pressure and demand warming up, futures prices may fluctuate strongly - **Terminal demand may show resilience**: Although macro - economic indicators in July were under pressure, the end of the "severe flood season" may relieve adverse weather factors, and the implementation of policies and project starts may improve the terminal demand for steel, especially for building materials [8][10][53]. - **Supply may be under marginal pressure**: Although steel mills' profits are okay, the approaching 9.3 parade may lead to significant production - restriction pressure on steel mills in North China, and the new round of supply - side reform in the steel industry may also limit the supply [26][53]. - **Limited pressure of inventory accumulation**: Although the expectation of "one - size - fits - all" forced production reduction is reduced and the real demand is still under pressure, the demand - side policies and the resilience of terminal demand may limit the pressure of inventory accumulation for rebar and hot - rolled coil [38]. (2) Iron ore: Demand under marginal pressure but with resilience and limited inventory pressure, futures prices may fluctuate strongly - **Demand with marginal pressure but resilience**: The upcoming 9.3 parade and the new round of supply - side reform in the steel industry may put marginal pressure on iron ore demand. However, steel mills' profits are okay, and the expectation of "one - size - fits - all" forced production reduction is reduced, so the demand may still have resilience [43][44][55]. - **Limited pressure of supply tightness**: Although the arrival of foreign ore decreased last week, the foreign ore shipment may return to normal, and the new production capacity of foreign mines and overseas equity mines may increase, so the pressure of supply tightness may be limited [46][47]. - **Limited inventory accumulation**: Due to the potential production - restriction of steel mills, iron ore demand may be under marginal pressure. But considering the resilience of demand, the accumulation of port inventory may be limited [49][52][55]. III. Mitigation of off - season adverse factors, supply under pressure, and limited inventory pressure, steel and iron ore futures prices may fluctuate strongly - **Steel**: The end - demand may improve marginally, and supply may be under pressure, so steel futures prices may fluctuate strongly. Steel producers and high - inventory traders are advised to speed up sales, while low - inventory traders and end - users can buy on dips or establish long hedging positions on the futures market. Investors can take short - term long positions on dips, and arbitrageurs can try to go long on the rebar - to - iron - ore ratio, all with stop - loss and take - profit [2][53]. - **Iron ore**: Although demand may be under marginal pressure, it still has resilience, and supply is marginally tight, so iron ore futures prices may fluctuate strongly. Steel mills and low - inventory traders can buy on dips or establish long hedging positions on the futures market, while high - inventory traders can speed up sales. Investors can trade within a range, and arbitrageurs can try to go long on the rebar - to - iron - ore ratio, all with stop - loss and take - profit [3][55].

Industry Overview - The steel industry is facing a challenging market environment with weak demand and declining profits, prompting companies to enhance cost reduction and efficiency while focusing on product differentiation and innovation [2][4] - From January to June, national pig iron and crude steel production decreased by 4.7% and 6.5% year-on-year, respectively, indicating a significant supply-demand imbalance despite the production decline [3] Market Dynamics - Steel demand has been negatively impacted by COVID-19 outbreaks in various regions, leading to a decline in key downstream industries and resulting in high steel inventory levels [3] - As of late June, steel inventory for key member enterprises of the China Iron and Steel Association (CISA) reached 16.95 million tons, a 50% increase from the beginning of the year [3] Price Trends - The average China Steel Price Index (CSPI) for the first half of the year was 133.92 points, a decrease of 2.85% year-on-year, with prices showing a trend of rising in the first four months and declining in May and June [3] - Raw material costs remain high, with coking coal prices averaging 2,956 yuan per ton, up 68.2% year-on-year, and coke prices averaging 3,099 yuan per ton, up 28.53% year-on-year [3] Financial Performance - CISA member steel enterprises reported a total revenue of 3.339 trillion yuan, a year-on-year decline of 4.65%, while total profits fell by 55.47% to 103.4 billion yuan [4] - The average sales profit margin decreased by 3.53 percentage points to 3.10% [4] Future Outlook - The steel industry is expected to see a gradual improvement in demand in the third quarter, driven by infrastructure investment and stabilization in the real estate sector [4] - The CISA emphasizes the need for supply-side structural reforms and strict adherence to production capacity reduction policies to stabilize the market [5] Strategic Responses - Companies are encouraged to adopt self-discipline and adjust production based on actual demand, avoiding blind production and unhealthy competition [6][9] - The industry is shifting focus from quantity to quality, with an emphasis on innovation, digital transformation, and green development to enhance competitiveness [8][10] Industry Consolidation - The steel industry is expected to undergo further consolidation, with the emergence of large-scale steel enterprises and specialized firms in niche markets [10] - The current market downturn may facilitate resource reallocation and improve operational efficiency through mergers and acquisitions [10]