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    The National Two Conferences Are Approaching Environmental Protection Limits Output

    158 Date: 2020-05-18 Tag: Environmental Protection Limits Output

    After the May 1st festival, driven by the strong performance of rebar futures, the spot price of steel rose, but with the rebar futures hovering at the price of 3500 yuan / ton and hindered, the steel price once again "cooled down" after the previous increase. In the unbalanced state where market demand has not yet been released and the supply is increasing, environmental protection and production limitation are the favorable options that the author believes at this stage.

    A few days ago, Tangshan City, Hebei Province held a meeting on the deployment of enhanced air quality improvement measures in May, reiterated its determination to win the blue sky defense battle, and at the same time released the "Schedule of Discontinuation of Production Limitation during Air Quality Enhancement Control in May", involving Jinxi Iron and Steel Group Tangshan Jianlong and many other local steel companies. According to preliminary estimates, the production capacity limit will reach 1.42 million tons.

    Compared with the same period last year, this year's Tangshan area has a wider production restriction policy, involving more steel companies, and stricter control measures. The author expects that the steel production capacity affected by the production limit in Tangshan in May will be greater than the same period last year. Considering that the current market is still facing high supply pressure, and the introduction of production restriction policies can suppress the release of market supply resources to a certain extent, provide favorable conditions for the market supply and demand to restore the balance, and add momentum to promote the rise of steel prices.

    It is important to note that the two sessions will be held in Beijing on May 22. In order to ensure the air quality during the meeting, it is not ruled out that Beijing, Tianjin and Hebei and the surrounding areas will introduce more intensive and strict production restriction policies. Tangshan is only one of them. . As the time of the two sessions is approaching, the environmental production limit will once again "blade out of the sheath", which will be favorable to the stability of steel prices to a certain extent.

    Overall, the production limitation in Tangshan in May brought about the possibility of balance between supply and demand in the steel market, but the effect of environmental protection production limitation depends on the actual implementation. In the long run, the price of steel products may continue to strengthen, and it may not rule out the possibility of a phased up and down, bottom adjustment.

    The National Two Conferences Are Approaching Environmental Protection Limits Output

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