Last week (March 5th-March 12th) the price of construction steel in Shanghai fluctuated upward, with a cumulative weekly increase of 40 yuan/ton. Last weekend, the market rebounded after the market dive. The billet rose sharply on the weekend, local trading began to be active, merchant prices rose sharply, and high-level transactions were average. Returning from the beginning of the week, the opening of the futures market rose straight up, and the merchants' quotations continued to rise. However, as the market went down from high levels, market demand gradually became quiet. Mid-week futures continued to decline, coupled with the performance of transactions that were not as good as expected, and the rapid increase in the previous period, the market price dropped significantly. At the end of the week, spurred by news, the futures disk rose again, the market volume increased significantly, and the local merchant prices once again rose significantly. However, the same as the previous period, after the high market price, the transaction was significantly weaker, and the overall resource price dropped slightly. The whole week showed a trend of strong volatility.
Judging from the current inventory data, on the 11th, the total inventory of wire rods in Shanghai's warehouses totaled 99,100 tons, a decrease of 12,500 tons from last week. The total number of snails was 216,100 tons, a decrease of 8,800 tons from last week. Last week, the high level of thread inventory continued to increase slightly, and the coil line decreased slightly, but the overall inventory volume was still high, and the pressure to de-stock was a long way to go. From the perspective of demand, speculative demand is more active at relatively low prices. As for terminal demand, after the price is high, the purchase plan for terminal orders is relatively slow after the price is high, the overall demand release tends to be tepid, and the emotional drive is more obvious. From a mentality point of view, the current inventory costs of merchants are relatively high. Under the condition that the overall market outlook is relatively good, the willingness to stand up after the price is low. However, as the price rises, the transaction will fall again, and the high price support will generally be strong. As a result, local businesses are cautious and entangled in their operations. On the whole, it is expected that the local construction steel prices will continue to show a trend of volatility adjustment next week.
