Analysis of late-stage steel futures prices not only depends on the current price and trading conditions, but also takes into account changes in resource supply, market demand, and inventory levels, as well as their influencing factors.

On the supply side, according to statistics, the domestic crude steel production in April has reached 933 million tons. Such a high level of resource supply far exceeds market expectations. Undoubtedly, this will allow the market to heat up the supply side's concerns. However, the national policy of restricting production of environmental protection is still in force, which restricts the increase in supply to a certain extent. In terms of inventory changes, according to statistics, the total number of rebar stocks has declined continuously since May. At present, the social inventory of rebar is lower than the same period in 2014, and the inventory of steel mills is lower than the same period in 2015. In terms of demand, the growth is not very clear. On the contrary, the demand for steel products in some industries has gradually tightened, which makes the contradiction between supply and demand intensify, and steel prices fluctuate and oscillate.

In terms of macroeconomic policies, the central government requires the expansion of domestic demand. The State Council requires that the time for examination and approval of construction projects be reduced. The Ministry of Finance calls for accelerating fiscal expenditure and the central bank to maintain a loose pattern of funds. At the same time, China will open a new round of ecological environmental protection work cycle, pollution prevention and control has been included in one of the three major tough battles, the seven major battles for pollution prevention and control are gradually sounded, and environmental protection inspectors have continued to increase their special campaigns. In the last two months, the National Development and Reform Commission is organizing the iron and steel industry to defuse excess production capacity and prevent special inspections of the re-launch of “Grid Steel”. The Ministry of Industry and Information Technology proposed to promote the high-quality development of China's steel industry.

In terms of the international economic situation, the Sino-U.S. economic and trade consultations reached a consensus that they would not fight the trade war and stop levying tariffs on each other. China and the United States will strengthen trade cooperation in such fields as energy, agricultural products, medical care, high-tech products, and finance. This can not only promote China's economic development towards high quality, meet the needs of the people, but also help the United States reduce its trade deficit. This is a win-win choice. At the same time, the two sides will continue to strengthen mutual investment and deepen cooperation in the field of intellectual property protection. This will not only benefit China and the United States but also contribute to the stability and prosperity of global economic trade.

At present, the domestic and international economic situation is generally good, the contradiction between the supply and demand of steel is controllable and adjustable, the relationship between supply and demand has been basically improved, the spot price of steel plants has risen steadily, and market sentiment has been relatively optimistic. It is expected that the prices of rebar and hot-rolled coil futures will remain high and volatile in the latter part of May and the overall change will not be too great.