What will happen in 2022 after the ups and downs in 2021?


The year 2021 is the first year of China’s 14th Five-Year Plan and the first year of its carbon peak and carbon neutral plan.With multiple outbreaks at home and abroad and the global economy continuing to recover, The Chinese economy got off to a solid start despite difficulties.Under the influence of multiple factors at home and abroad, the wide shock of the iron and steel market, the average price rose significantly, the iron and steel industry profits obviously repair, iron and steel enterprises actively plan long-term development, accelerate mergers and restructuring and low-carbon layout, but the iron and steel industry is still in the raw material security is restricted, the cost of high dilemma.In 2021, the price of domestic steel fluctuated greatly, hot rolling led the rise of black metal in the first half of the year, hot rolling coil and rebar spot rose to 6750 yuan per ton and 6090 yuan per ton respectively, the underlying logic of steel price rise is the demand rise caused by global monetary policy easing after the epidemic, but the logic of market transactions at different stages,And the spread structure is not the same.The first stage: at the beginning of the year – May 12, rebar main contract rose from 4300 yuan per ton to 6200 yuan per ton, the main logic is the global economic recovery of steel demand pull, especially manufacturing demand and overseas imports of China increase significantly.During the convergence trend, including the futures base spread and intertemporal spread are at a low level, futures even appear a premium structure.Profits widened as prices rose, with profit per ton of steel up to 1400 yuan per ton.The second stage: From May 13 to October 11, the main contract of rebar steel peaked and fell on May 12, fluctuating in the range of 4800-5800 yuan per ton.The logic of market trading is the game between supply side and demand side.During the price difference shows that futures are stronger than spot, far month is stronger than near month state, in essence, the market for gold nine silver ten peak season demand has higher expectations.During the v-shaped trend of profit per ton of steel, May-June due to the growth of global crude steel production, iron ore price is stronger than timber, timber price decline intensified profit contraction per ton of steel, rebar profit once appeared in the red.After mid-July, iron ore prices weakened due to production cuts at domestic steel mills, which turned a profit and saw profits rise again to 1,200 yuan per ton.The third stage: From October 12 to December, the high steel price tends to decline from 5800 yuan per ton to 4100 yuan per ton.The main logic is that the peak season demand is falsified, seasonal decline in demand and real estate long cycle demand decline resonance, valuation overall decline.During the expansion of the spread, futures discount spot, far month discount nearly months.Thread ton steel profit trend decline, ton steel profit once fell to a loss, after the price of raw materials to make up for the fall, ton steel profit recently repaired to 500 yuan per ton.2022 is the year of the 14th Five-Year Plan. Driven by policies, infrastructure investment is expected to accelerate in 2022, manufacturing investment will maintain a rapid recovery, and real estate investment growth will bottom out.Consumption will recover steadily;The marginal growth rate of export is slowing down, but it may still remain high. In 2022, China’s economy will achieve a growth rate of more than 5%, and the economy will gradually return to the normal growth track. Then, what opportunities and challenges will the steel industry meet in 2022?01, 2022 output outlook: steel output or continue to decline at the end of 2021, the “14th Five-year” raw material industry development plan released, the “14th five-year” period, the steel industry will implement carbon peak implementation plan, coordinated pollution reduction and carbon reduction coordinated governance, to 2025, crude steel production capacity only reduced not increased.In 2022, the “double carbon” constraint of the steel industry will be further promoted.Quarter, the beijing-tianjin-hebei and surrounding areas for iron and steel industry peak production, the plan will continue to perform the execution time on March 15, from January 1 solstice, to reduce the heating season to increase emissions of air pollutants as the goal, in principle, the relevant area iron and steel enterprise peak production rate is not lower than the same period last year 30% of the crude steel production.(A small program has been added here, please check it on toutiao client.)In 2022, under the “cross-cycle and counter-cycle” regulation policy, fixed asset investment is expected to enter the upward cycle, infrastructure investment is expected to pick up, real estate investment will drag down steel demand, manufacturing steel demand has increased, in general, China’s steel demand will decline slightly.Infrastructure investment is expected to pick up in 2022. The current local government bond funds have become an important source of capital for infrastructure investment.The Ministry of Finance recently issued an earlier quota of 1.46 trillion yuan in special bonds to local governments for 2022.The early issuance of the quota of new special local government bonds will provide financial support for “moderately advanced infrastructure investment”. This will facilitate the formation of physical work early next year, and will give full play to the role of infrastructure in supporting the economy.The 2022 special bond funds will be mainly used in nine major areas: transportation infrastructure, energy, agriculture, forestry and water conservancy, ecological and environmental protection, social programs, cold chain logistics infrastructure in urban and rural areas, infrastructure in municipal and industrial parks, major national strategic projects, and low-income housing projects.In 2022, major projects under the 14th Five-Year Plan will be launched one after another. In addition, the issuance and use of special bonds in 2021 will lag behind, and some funds are expected to be carried over to next year, which will strongly support the rebound of infrastructure investment.At present, the country still adheres to the positioning of “housing rather than speculation” in the real estate industry and insists on not using the real estate as a means of short-term economic stimulus.From January to November 2021, China’s investment in real estate development reached 13.731.4 trillion yuan, up 6.0 percent year on year.Land purchase area decreased by 11.2% year on year.New housing starts fell 9.1 percent year on year.Land is the raw material of real estate investment, and land is the best leading indicator of real estate investment.Nationally, land transactions have a 6-month lead on new real estate starts and a 9-12 month lead on real estate investment.The decline in land transactions determines that the growth rate of new construction and investment in real estate will face a big decline in 2022.Manufacturing steel demand in 2022 still has growth potential “difference” period, the industrial structure, mode of production in our country will become green, low carbon transformation, green, low carbon technology and equipment being widely applied in energy resource utilization efficiency is greatly increased, green manufacturing levels and improved, for carbon up to the peak in 2030 industry to lay the solid foundation.In 2022, China will focus on boosting the industrial economy to provide strong support for stabilizing the overall economic market.Strengthening and reinforcing chains in the manufacturing industry and increasing assistance to small and medium-sized enterprises will accelerate the upgrading of the industrial structure of the manufacturing industry. Investment and added value in the manufacturing industry are still expected to maintain a high growth level, and the demand for steel in the manufacturing industry still has growth potential.In 2022, China’s steel production release will still be restricted, driving iron ore demand continues to fall.From the perspective of iron ore supply, the fiscal year 2022 shipping targets of the four mines show that iron ore shipping volume in 2022 has a certain increase.Based on relevant data, it is estimated that the four major mines will increase by 27.87 million tons in 2022, an increase of about 2.5%.In 2022, the supply and demand of iron ore market will be relaxed, and the iron ore price will be significantly adjusted.In addition, with the release of coking capacity, coke supply release, at the same time the coking coal supply tension has been alleviated, steel production constraints will also have a contraction of coke demand, coke supply and demand tight relationship will be improved;Coking coal prices move down to make coke raw material costs in 2021 have fallen, coke prices will return to rational.In 2022, China’s economic recovery momentum will weaken, investment growth will be structurally differentiated, infrastructure investment is expected to improve, manufacturing investment may continue to grow, real estate investment is in the boom down range;Export growth will slow at the margin and consumption is expected to repair modestly.(A small program has been added here, please go to toutiao client to check) 2021 has become the past, 2022 set off!Looking forward to 2022, China’s steel industry is still facing both opportunities and challenges.Under the pressure of high inflation, global monetary policy has been gradually tightened. Repeated outbreaks of COVID-19 may delay the recovery of the global economy, and global economic growth may slow down in 2022.Currently, the domestic economy is under downward pressure, and China has emphasized and clarified the keynote of “stable growth”, so “stable growth” may become the main policy line in 2022.Source: Wan Jun Lvjian said

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