From the point of view of steel mill profits, according to feedback from some steel mills, short-process steelmaking is basically on the loss line, while long-process steelmaking has a profit margin of 100-300 yuan/ton. Jiang Runqin, an iron and steel analyst, said that due to the depression of the steel market environment, marginal benefits of steel material have been reduced to freezing point. Of course, differences in production process, procurement cost and production restriction among steel mills have formed divergent trends in the current steel market.
From the steel material market point of view, according to research, at present most domestic steel mills scrap consumption cycle is concentrated in 7-20 days, leading steel mills in the middle level, individual large steel enterprises consumption cycle to 30-40 days (belonging to the daily level of storage).
"There is a gap of about 15 days before and after the Spring Festival, and a partial gap or longer. For steel mills, the current inventory level is not high, and there is an obvious upward trend after the Spring Festival. Since 2016, the steel market has opened every year after the Spring Festival, and the above-mentioned adjustment of the suction market is the main one. Jiang Runqin introduced, however, although the steel market is bullish after the Spring Festival, traders are still cautious, mainly because the steel spot trend is not clear, in short, the prosperity of steel material still depends on the profitability of steel mills.
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