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Market News Daily Review of Coking Coal and Steel Mine Futures

Daily Review of Coking Coal and Steel Mine Futures

Iron ore: Resumption of work continues to push prices to remain strong; thermal coal: policy continues to fluctuate; coke coking coal: just need to support coke strong shocks; rebar: expected to rise in the warmer period; ferroalloys: waiting for steel to recruit manganese and silicon to dip mostly

2022-05-31
8012
Iron ore: Resumption of work continues to advance, prices remain strong;
Iron ore continued to rebound on Tuesday with a strong trend. The main contract once stood at 900 points during the session, and the recent downside has basically recovered. In terms of industry, the resumption of work and production continues to advance. Logistics and industrial production are about to resume from June 1. Stimulated by policies and funds are loose, it is expected that demand will continue to strengthen. In reality, the demand for finished products is still weak, and the inventory pressure is relatively large. With the resumption of work and production and the recovery of logistics, the shortage of scrap steel may be eased, and the production of molten iron will be under certain pressure. The current iron ore inventory is relatively low. If the production of molten iron continues to increase in the next month, the iron ore inventory may be very tight. In terms of trend, iron ore is still strong. In operation, it is recommended to do more on dips.



Thermal coal: The policy is raised again and the shock continues;
The main thermal coal contract continued to fluctuate on Tuesday. In terms of policy, thermal coal will be raised again, and by stabilizing energy prices, enterprises will reduce costs and achieve stable development. In terms of supply and demand, thermal coal remains loose, and spot supply continues to increase. The data in April showed a year-on-year increase of 10%. In terms of demand, the short-term is relatively weak, with electricity increasing by about 3% year-on-year and inventory accumulation. With the resumption of work and production in progress, the demand will be released, and the demand for peak summer will also increase. Under the expectation of demand for thermal coal in the peak season, speculative sentiment still exists. It is expected that under the strong supervision of the policy, thermal coal will remain range-bound. Operation, it is recommended to wait and see.

Coke coking coal: just need to support coke strong shock;
On Tuesday, coke 2209 opened at a high level, with strong shocks. The spot of coke has been raised and lowered, and coke enterprises have suffered losses. Some coke enterprises have declined in production and reduced supply. The demand is short, the blast furnace operation of steel mills is at a high level in the short term, and the production of molten iron continues to increase on a week-on-week basis, supporting the rigid demand for coke. In terms of inventory performance, after the coke spot has been raised and lowered, port traders have increased their enthusiasm for picking up goods, and coke enterprises have been actively shipping, and there is no inventory pressure for the time being. The market is optimistic about the recovery of demand in June, and the sentiment has turned warmer. The futures disk rebounded at a low level, with strong fluctuations. It is recommended to operate short and long.
On Tuesday, coking coal opened at a high level of 2209, with strong shocks. Some coal mines in Shanxi were shut down for maintenance, and some areas in Inner Mongolia were affected by environmental inspections, and coal mine operations were restricted, and domestic coal supply declined month-on-month. In terms of imports, Mongolia's customs clearance efficiency has rebounded, import volume has increased, and quotations have been lowered. On the demand side, coke enterprises are losing money, and the market is still expected to increase and decrease, and raw materials are purchased on demand. The futures disk was boosted by market confidence and rebounded at a low level, and short-term operations are recommended.

Rebar: expected to rise in the warmer period;
The price of snails fluctuated strongly on Tuesday. On the macro side, the government will continue to make efforts to ensure the economy, and the central bank will cut the LTR long-term interest rate, which is conducive to economic recovery. From the perspective of supply and demand, the latest supply and demand data of Shanghai Iron and Steel Federation has been released. The output of rebar has dropped to 2.93 million tons, and the inventory of steel mills has continued to rise. , the chain decreased by 80,000 tons. In the short term, demand is still insufficient, but at present, blast furnaces and electric furnaces are not profitable, steel is facing cost support, coupled with macro support, the policy is warming. Steel prices may rebound from falling, and it is recommended to do more on dips.

Ferroalloys: waiting for steel to move, manganese and silicon are mainly to be long on dips;
Manganese silicon: Manganese silicon futures prices opened higher and moved lower on Tuesday. At present, manganese silicon has a strong cost support, and the profits of both the north and the south are negative. The manganese department of the Ferroalloy Association called for production reduction, and the production of manganese and silicon began to decrease significantly, and the production reduction was implemented. This week (5.26) Mysteel counted a sample of 121 independent silicon-manganese enterprises across the country: the operating rate (capacity utilization rate) nationwide was 58.59%, a decrease of 1.54% from last week; the average daily output was 27,220 tons, a decrease of 470 tons. From the perspective of demand, the output of rebar has dropped slightly, but the decline is less than that of manganese silicon. The market went from surplus to shortage. It is recommended to look at manganese silicon more.
Ferrosilicon: Prices of ferrosilicon futures fluctuated on Tuesday. The profit of ferrosilicon is still good, and the market will be more willing to produce. This week (5.27) Mysteel counted a sample of 136 independent ferrosilicon enterprises across the country: the operating rate (capacity utilization rate) nationwide was 52.19%, down 0.15% from the previous issue; the average daily output was 18,016 tons, down 95 tons from the previous issue. Domestic supply and demand of ferrosilicon tend to be in excess, and overseas demand has also declined. Ferrosilicon futures still have high profits after the fall, and it is recommended to sell short on rallies.

Source: Guosen Futures
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