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【Steel Prices】How Did Prices Move This Week? Analysis of Steel Prices for the Third Week of September!

Supply and Demand Logic

From the perspective of demand trends, current steel consumption is already in a slow-release channel. It is expected that this week will continue a slight warming trend, with transaction activity further increasing. On the supply side, with the end of production restrictions related to the military parade, long-process steel mills are gradually resuming production. However, due to continued profit contraction, production enthusiasm remains generally low, and output will still maintain a relatively low level, with overall supply showing only narrow fluctuations.

At the same time, independent electric arc furnaces remain in a loss-making state, and production of rebar and other varieties continues a slight contraction. Electric arc furnace enterprises face significant cost pressures, short-term profitability is difficult, production motivation is insufficient, and incremental supply is limited.

Overall, this week steel supply is stable with minor adjustments, demand continues to slightly recover, and the supply-demand structure maintains a marginally improving trend. Factory and social inventories may slightly decrease. Under the combined effect of demand recovery and supply contraction, the steel market supply-demand relationship tends to ease.

Macro Logic

Internationally, this week the Federal Reserve's interest rate meeting is expected to announce a rate cut, which the market has largely anticipated. The market's earlier response to potential rate cuts was relatively muted, possibly because part of the expectation has already been priced in, combined with participants' differing views on policy effectiveness in the current complex economic environment.

Domestically, August economic data have been released, showing that investment and consumption remain generally weak and are unlikely to provide effective support to market sentiment. At the macro level, there is a lack of trend-driven momentum in the short term.

Summary

Overall, the steel fundamental situation presents a pattern of both weak supply and weak demand, but gradually trending toward balance, with limited macro support. With the bottoming effect of pre-"Golden Week" inventory replenishment expectations, the downward space for steel prices is limited, but upward momentum is also insufficient. It is expected that the mainstream price trend this week will be mainly oscillating and consolidating.

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