China's pig iron market on July 11th

Domestic Pig Iron Market Operates with a Bullish Bias Today.

Some regions see pig iron prices increase by 20-80 yuan/ton.

Macro Aspect

On the morning of July 11th, the Market Committee of China Coking Industry Association held a special market analysis meeting. Representatives from key coking enterprises in Shanxi, Hebei, Inner Mongolia, Henan, Jiangsu, Shandong, Shaanxi, Ningxia, Jiangxi, Yunnan-Guizhou and other regions attended the meeting. Combining the current macroeconomic environment and industry trends, the participants conducted an in-depth analysis of the supply and demand pattern and price trend of the coke market, and reached the following consensus: The participants unanimously believed that the current coke market should raise prices as soon as possible. The first round of coke price increase is expected to be implemented next week, which will support the pig iron market. Recently, the Center for Urban and Small Town Reform and Development of the National Development and Reform Commission stated that aiming at the goal of basically realizing new urbanization by 2035, we should conform to the laws, grasp the trends, seize the critical period when the driving force of urbanization is still strong, and promote the four major actions of new urbanization with high quality to provide strong support for Chinese-style modernization. Among them, we should take the use of funds for "two priorities" and "two news" as the starting point to increase investment in key areas of new urbanization.

Futures Aspect

By the close, the main black series varieties operated with a bullish bias. Iron ore rose by 13.5, closing at 764; coke rose by 41.5, closing at 1519.5; coking coal rose by 29.5, closing at 913; rebar rose by 34, closing at 3133; hot-rolled coil rose by 40, closing at 3273.

Cost Aspect

Coke prices operate stably for the time being. Major coking enterprises in Hebei have raised coke prices: starting from July 14th, tamped wet quenched coke will be increased by 70 yuan/ton, top-charged wet quenched coke by 90 yuan/ton, tamped dry quenched coke by 75 yuan/ton, and top-charged dry quenched coke by 95 yuan/ton; iron ore prices have risen slightly, providing strong short-term cost support for pig iron.

Supply and Demand Aspect

The pig iron market presents a pattern of supply and demand game. The fluctuating and strengthening of black series futures has boosted market confidence, and ironworks generally raised their quotations, with a strong bullish sentiment. On the supply side, the active shipment strategy of ironworks has been effective, the inventory in the factories has continued to decline, and the supply pressure has been significantly relieved; on the demand side, as prices continue to rise, end-users' acceptance of high-priced resources has decreased, the purchasing rhythm has become cautious, and high-priced transactions are slightly weak.

Comprehensive Outlook

It is expected that the pig iron market will operate steadily with a bullish bias next week.