Steel bid farewell to "cabbage price", and its performance in the first quarter was bright. Will steel prices continue to rise?

On April 12, Valin Iron and Steel announced the 20021First Quarter Performance Express, showing that Valin Iron and Steel achieved a total operating income of 38.646 billion yuan in the first quarter, up 63.46% year-on-year; The net profit attributable to shareholders of listed companies was 2.054 billion yuan, up 865.438+0.06% year-on-year, and both operating income and net profit reached the best level in quarterly history.

Valin Iron and Steel said that in the first quarter, the company overcame the difficulties of high raw material prices, seized the opportunities in the downstream market, continued to promote the construction of three strategic support systems: lean production, marketing integration, scientific research and production, and marketing services, accelerated the upgrading of production lines and product structures, and continuously improved its operational efficiency and profitability. The profits of its subsidiaries, Lv Lin Yanliangang and Auto Plate Company, both reached record highs in this quarter.

The high-profit growth of Valin Iron and Steel is not an isolated case. Previously, the quarterly performance reports released by many steel companies such as Chongqing Iron and Steel Co., Ltd. all showed huge growth. For example, Chongqing Iron and Steel's net profit increased by 259 times year-on-year, and its net profit increased by 80% to 90%. The performance of steel enterprises in the first quarter not only far exceeds the first quarter of 2020 affected by the epidemic, but also far exceeds 20 19 in the same period.

A number of steel companies said that the improvement of industry prosperity in the economic recovery environment is an important reason for the substantial increase in performance. TISCO Stainless "frankly", in the first quarter of 200212002, affected by the macroeconomic recovery, the demand of steel downstream industries increased, and the rising price of raw materials also pushed up the price of steel. The company seized the opportunity to greatly improve production efficiency, and at the same time, differentiated products were produced, and the competitiveness of products continued to improve.

Statistics also show that although the prices of raw materials and downstream products have risen, the price increase of steel downstream products in the first quarter is still higher than that of upstream products. Among them, rebar futures prices rose 14.6% in the first quarter. Although the price of iron ore fluctuated greatly in the same period, the overall increase was about 9.4%, and the higher-priced hot coil increased by as much as 20% in the same period. The price of hot coil futures once approached 5400 yuan per ton, setting a new high since listing.

Carbon neutrality: supply-side structural reform 2.0?

However, what impact will this "constraint" bring to the industry? "The peak of carbon dioxide emissions and carbon neutrality will definitely bring a reshuffle to the steel industry." In this regard, Wu Wenzhang, the founder of Steel House, believes that steel enterprises with ultra-low emission and environmentally friendly production will have more room for development in the future, while steel enterprises with backward technology and production capacity will not only be competitive, but will also be eliminated by the market.

Peter F. Marcus, dynamic management partner of the world steel market, also said that burning one ton of coal will emit 2.3 tons of carbon dioxide. At present, a large number of steel mills use coal and coking coal to convert into metallurgical coke, and the low-carbon development challenges facing the industry in the future are enormous.

This may require a huge investment in the industry. "It is reported that China needs to invest 100 trillion yuan to achieve carbon neutrality. According to the proportion, China steel industry needs nearly 20 trillion investment, which is more than 100 times of ultra-low emission investment. " Jiang Wei, deputy secretary of the Party Committee of China Iron and Steel Industry Association, said.

However, in the opinion of many experts, in the short term, the reliable way to achieve the peak of carbon dioxide emissions is probably to reduce production. On the one hand, reducing production will help to achieve the goal set by the policy; on the other hand, it can improve the pattern of loose steel supply and strong demand for raw materials, reduce the pressure of rising costs brought by the sharp rise in the prices of raw materials such as iron ore and coke in the upstream, keep the tight balance between steel supply and demand, and further promote the rational distribution of profits in all links of the industrial chain.

"The crude steel output of 202 1 is likely to decrease year-on-year, and the industry production cycle basically ends at 202 1. The future production capacity is no longer the sorrow of steel profitability." In this regard, Guotai Junan Securities reported that.

The era of low prices may be passing.

The short-term supply and demand situation brought about by the reduction of low carbon and high input and output at the production end continues to improve ... In the opinion of industry experts, with the rising cost and the change of market situation, the era of low prices is likely to end for steel products.

Previously, due to the continuous growth of production capacity, steel prices continued to fall, and rebar prices once fell below 2000 yuan per ton at 20 15. "A pound of steel can't even sell the price of a cabbage." "Driven by the carbon-neutral policy, the supply of crude steel is expected to decrease year by year, the merger and reorganization of the industry and the green transformation will also accelerate, and the cost will rise." In this regard, Zhang Qiusheng, director of marketing department of Nangang, thinks.

However, after the surge in the first quarter, the industry is still cautious about the rise in steel prices during the year. "In the second quarter, the domestic steel market price may mainly fall back or fluctuate at a high level, and there is great uncertainty in the market in the second half of the year." Wu Wenzhang believes that the key factor of steel market trend in the second half of the year depends on the implementation of the policy of "double control" of steel production capacity.

In fact, after the rise in the first quarter, the cost pressure of downstream machinery, shipbuilding and other industries is not small. "In the face of rising raw material prices, the increase and increase of other shipbuilding countries are significantly lower than that of China." Tan Naifen, Deputy Secretary-General of China Shipbuilding Industry Association, said that the price of 20mm shipbuilding board in South Korea at the end of March was about 4,800 yuan per ton, and the cost of steel alone was at least 10% lower than that of domestic shipbuilding enterprises.

However, steel prices still have strong support in the short term, especially in the environment where major European and American economies still maintain loose monetary policies. "2020 can be said to be the year of global' water release'. European and American economies continue to be loose. The United States continues to launch economic stimulus plans and new infrastructure plans this year. The proliferation of dollars is bound to push up global commodity prices, and the steel industry chain is no exception. " Some experts pointed out.