Demand is growing in April, supply is also growing, and supply and demand are in balance. We expect this situation to continue in May. In May, the entire steel market will show: high output, high demand, low inventory, short-term steel There is little contradiction between supply and demand.

In terms of demand for building materials, the contribution of infrastructure and real estate to the growth of steel demand in the second quarter is still relatively large, real estate investment continues to remain high, and there will be no significant decline in the short term; and the policy guidance for infrastructure and short-term local special debt will be accelerated. In the background, infrastructure investment continued to rise from the previous month and is expected to rebound to 8% in the second quarter.

In terms of steel for manufacturing, construction machinery will maintain high growth, while driven by automobile and household appliance consumption stimulus policies, home appliance production and sales will maintain moderate growth, and the decline in automobile production and sales will also narrow. The downward adjustment of value-added tax is most beneficial to downstream manufacturing industries, helping steel companies to reduce raw material costs and capital occupation, and to stimulate demand for steel.

While demand is picking up, steel supply pressure is still rising. Since the environmental protection and production restrictions have been relaxed since September last year, even during the heating season, the national steel output has maintained rapid growth. After the end of the northern heating season on March 15, the Beijing-Tianjin-Hebei and surrounding steel mills and the Qiping Plain Steel Plant gradually resumed production in the near future. At the same time, due to the general increase in steel prices in the spot market, electric furnace steel mills began to make profits, and the operating rate showed a significant rebound. Recently, Hebei Tangshan, Wu'an Wu'an, Shanxi Linyi and other key steel production and coke producing areas have introduced the second and third quarter non-heating season environmental protection and production restrictions. From the past, the market is not expecting a limited production effect.

However, we should see that as the economic situation has improved, the pressure on trade friction between China and the United States has eased, and environmental protection has been mentioned as an important position. The intensity of steel environmental protection and production will be strengthened compared with the previous period being moderate.

Long material is strong, sheet is weak; hot rolling strong, cold rolling weak situation will continue in May

Building materials were slightly stronger than steel in April, and cold rolling was the weakest among all varieties. It is expected that this trend will continue in May and June. The main reasons are: real estate will remain high, the infrastructure will rebound sharply, the demand for building materials has a relatively large pulling effect, while the manufacturing industry is relatively weak, and cars and home appliances will be weak.