Following the restriction of production, as the news of "cutting power cuts" in various places swept across the screen, power cuts became a new speculation factor in the steel market. However, compared with the unilateral increase in the market brought about by the production restriction policy, the disturbance of the market situation by the power restriction policy is more obvious. For example, the price of coke futures, which has been relatively strong before, has recently opened a wide range of fluctuations between 3,300 yuan/ton and 3,500 yuan/ton, and rebar and hot coil futures have also fluctuated repeatedly. Compared with the futures market, due to operations such as reluctance to sell and lock up the warehouse, the spot market has risen more decisively. The price of billet has returned to above 5200 yuan/ton, and the price of finished products per ton has risen by more than 100 yuan.

In the author's view, the subtle changes in the current spot market for steel futures are mainly due to differences in the market's interpretation of the impact of the curtailment policy on production constraints and demand restrictions. In the eyes of market participants with a bullish view, under production and power restrictions, market supply will shrink rapidly in the later period, and the mismatch of supply and demand will reappear, bringing room for substantial increases in steel prices. Market participants who hold a bearish view believe that power rationing has inhibited demand release, and steel prices are affected by weak demand and do not have the conditions for a sharp rise. It is true that both views need time to verify.

There are two main aspects to the curtailment policy related to the iron and steel industry: On the one hand, high-priced coal causes losses in thermal power companies, weak power generation willingness, and short-term short-term power supply, leading to passive curtailment. The electricity curtailment in Guangdong, Anhui, Liaoning, Heilongjiang, Jilin and other provinces falls into this category. On the other hand, under the pressure of the "double carbon" (carbon peak and carbon neutral) policy, in order to complete the task of dual control of energy consumption, individual regions have rushed to "cut the switch and limit electricity." Jiangsu, Zhejiang, Sichuan, Henan, Chongqing and other provinces (municipalities) fall into this category. Of course, the possibility of a combination of two factors in very few areas cannot be ruled out.

Although power rationing has caused the short-term trend of steel prices to be unstable, there are many "moistures" caused by market speculation, misunderstandings by related parties, and poor information. The author believes that as an upgrade of production restrictions, power curtailment will further strengthen supply-side constraints, help improve the contradiction between market supply and demand, and benefit the upward trend of steel prices.

In addition to the supply side, power curtailment will also have a restrictive effect on the demand side. This is mainly because the impact of power curtailment on manufacturing companies is more obvious. For example, in Guangdong's Foshan, Shantou and other manufacturing areas, the power curtailment policy of "open one stop six" or "open two stop five" is often implemented. The production rhythm of manufacturing enterprises is disrupted, and the release of demand is slowed down. Under the influence of the curtailment policy, steel demand may shrink further in the later period. At the same time, the increase in raw material prices brought about by the policy of restricting production and electricity has also forced the manufacturing industry to take the initiative to reduce production. For example, during the National Day holiday, due to rising raw material prices and declining downstream demand, major steel pipe manufacturers such as Youfa Steel Pipe and Zhengda Pipe Manufacturing experienced a rare collective shutdown of 7 days to cope with the imbalance of market supply and demand. This is enough to explain the impact of the power curtailment policy on the demand side.

Under the dual influence of production restriction and power restriction policies, the operation logic of the steel market is no longer solely dominated by production restriction policies. The market operation logic will be switched from supply constraints to a dual-constraint operation mode. The "supply and demand double weakness" pattern may be further enhanced. Highlight. On the whole, under the influence of the curtailment policy, the steel market will maintain an upward trend in the later period. However, due to the difference in the specific implementation of the curtailment policy, it is expected that the difference in the market trend of specific steel varieties will be more obvious, and the cross-regional flow of steel may be Will start early.

In particular, it is worth noting that the curtailment policy may change the long-lasting pattern of "long-term weakness and strong board strength". This is mainly because the power curtailment policy affects the shrinkage of rebar supply. As of September 30, the utilization rate of rebar capacity has fallen from the highest 81% to 59.4%. Among them, the utilization rate of electric furnace short-flow steelmaking restricted electricity was only 31.7%; the weekly rebar output fell to 2.71 million tons, a record This is the lowest level since April 2020. However, the impact of the policy of limited power supply for plates is not significant, and the decline in output is limited. However, considering the impact of power rationing on manufacturing demand, it is difficult for sheet materials to "excellent". This uneven supply and demand performance may deepen the differentiation of rebar and plate trends in the later period, and the pattern of "long strength and weak plate" may regain its dominant position.

All in all, under the superimposed influence of production restriction and power restriction policies, the market supply side contraction is expected to strengthen, and futures spot prices still have a certain amount of room to increase. In the process of correcting the curtailment behavior at the national level, the impulsive energy of steel prices will weaken, and more will maintain a strong turbulence.