February mold steel market prices run strong

Updated 2023-02-03

Overview: In January, the domestic mold steel market prices showed an overall upward trend of shocks, supply and demand in a weak balance. Steel mills, the Great Wall Special Steel for all varieties of molybdenum 1% up 600 yuan / ton (including tax); all varieties of vanadium 1% increase of 200 yuan / ton (including tax). Raw materials, the domestic molybdenum market continues to show a sharp rise after the holidays, by the upstream raw material prices continue to rise, ferromolybdenum prices rose; vanadium market overall stability in the strong, February bidding up landing; tungsten market in a high level of consolidation state, the terminal carbide consumption continues to recover; high carbon ferrochrome market price atmosphere, the average price at the end of the month in 9378 yuan / 50 base tons. Due to the high price of raw materials, pushing up the production cost of steel mills, most of the mold steel production enterprises no profit, the late production was suppressed. With the post-holiday in-transit resources into storage, the growth rate of inventory will gradually slow down due to the overall low supply. Domestic mold steel prices are expected to run strong in February, need to pay close attention to production profits and demand recovery rate.

A, the domestic mold steel mills production situation

According to my network tracking statistics special steel class mold steel production enterprises 31 (excluding Huangshi area), the total output of mold steel in January 38,100 tons, compared with December 2022, down 0.17 million tons, down 4.27% ringgit, compared with 22 years in January year-on-year reduction of 9.72%.

Second, in January the domestic mold steel market operation review

(A) review of the price trend of the die steel market

In January, the domestic mold steel market prices rose, the market trading atmosphere in general, including cold, hot mold steel average price of 14025 yuan / ton and 18170 yuan / ton respectively. Driven by the sharp rise in ferromolybdenum prices, after the holidays around the market ushered in the "open door" market, prices are significantly higher.

(B) mold steel inventory situation

According to the 30 mold steel distribution enterprise research samples continuously tracked by our network, in January, the market merchant inventory in 74,100 tons, compared with December 2022, an increase of 0.2 million tons, compared with 22 years up 7.70%. In order to avoid risks, most traders choose to operate cautiously and prepare their stocks to take a fast-in and fast-out operation. Before the festival and during the Spring Festival, the logistics and transportation capacity dropped significantly, and the steel mills' shipments were greatly affected, and the plant storage showed a significant rebound and an overall trend of accumulation.

Third, the operation of raw materials ferroalloys

January vanadium alloy market prices overall stability in the strong, now ferrovanadium FeV50 cash price of 144-145,000 yuan / ton. Market trade enterprises for the high level of follow-up operations are increasingly cautious, the continuation of the "delivery order-oriented" or "fast in and fast out" mode of operation, the high level of inventory will not be strong. The cost support, international high, expected to be good, the mentality of the vanadium alloy prices under the rise there is a certain upward momentum, fluctuations are limited by the reality of demand on the ground; domestic ferromolybdenum prices this month hit a new high of 17 years, the end of the mainstream ferromolybdenum cash ex-factory offer in 38.0-39.5 million yuan / ton. Molybdenum raw material market supply continues to be tight, ferromolybdenum cost is at a high level, coupled with the international molybdenum market has risen one after another, the export window opened, the domestic molybdenum market confidence, ferromolybdenum offer up several times in the same day, steel mills have limited raw material inventory, the downstream steel mills ferromolybdenum demand is larger main, after the holiday stocking positive, as well as in the international molybdenum prices jumped sharply under the added support, so ferromolybdenum prices continue to hit new highs; domestic tungsten market is in a high The domestic tungsten market is in a state of high consolidation, and the mainstream FeW80 is currently reported at 181,000 yuan/ton. After the return of the year, benefiting from the epidemic release, economic data continues to improve, the terminal carbide consumption continues to recover, prices rise, as well as ferromolybdenum prices again high and firm, the tungsten market expects to rise to support the price mentality is high, pity sales mentality is strong, short-term tungsten prices are easy to rise but difficult to fall.

Fourth, in January the domestic mold steel market prices rose slightly

(A) January PMI rose over the previous month, the manufacturing boom level rebounded significantly

In January 2023, China's manufacturing purchasing managers index (PMI) of 50.1%, up 3.1 percentage points over the previous month, rose above the critical point, the manufacturing boom level rebounded significantly. January, the production index and new orders index were 49.8% and 50.9%, 5.2 and 7 percentage points higher than the previous month, manufacturing production and demand boom level rebounded significantly, but by the spring holiday factor However, affected by the spring holiday factor, the production improvement is less than the market demand.

(B) supply and demand continue to be in a weak equilibrium in January, the domestic mold steel oscillation strong

In January, the domestic mold steel market prices were oscillating strong trend running, seasonal characteristics are obvious. Some of the downstream terminal enterprises affected by factors such as funds before the holidays, reduce the purchase of steel, the market businessmen also gradually shift the focus to payback. The current strong price of molybdenum pushed up the irrational price range, will certainly cause the domestic industry cost pressure, some steel mills on the high molybdenum varieties to hold off on orders. The market demand has not been very strong at this stage, and the rigid demand is giving less support to the market price. But taking into account the high prices of raw materials, steel mills are currently high production costs are difficult to down, with the high price of resources continue to replenish, is expected to February mold steel market continues to shake up.

(C) the profit margin decline is more obvious in January mold steel export pressure is highlighted

According to the data tracked by our network, the total export of domestic mold steel in January was 0.86 million tons, accounting for 19.6% of the total mold steel production. The recent domestic market overall trend, export prices to follow the rise in the magnitude of less than the domestic trade. And due to the reason of the New Year, some of the export orders are rushed to send in the early. Part of the export-oriented enterprises continue to export a small shrinkage, the profit margin decline is more obvious.

The recent stage of market demand has not been very strong, the current social inventory, steel mill inventory slightly increased, rigid demand to give the market price support weakened. However, due to the current stage of steel mills no profit, production enthusiasm is inhibited to a certain extent, so the production rebound space is limited. Steel mills are expected to be cautious about raw material purchases in February, and the rate of production recovery will be slow due to profit problems. The current strong price of molybdenum pushed up the irrational price range, will certainly cause the domestic industry cost pressure, some steel mills have been on the high molybdenum varieties to suspend the order. In the case of tight raw materials overlapping with downstream consumption recovery, it is expected that in February the mold steel market prices continue to oscillate upward, need to pay attention to the speed and strength of demand recovery.