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Recently, a stainless steel enterprise issued a notice saying that the current market situation is severe, and the production organization and operation of the enterprise are quite difficult. Some production lines of blast furnaces and steelmaking have been suspended or repaired, and production has been greatly reduced. It was decided to notify the long-term association suppliers in advance. In August, the procurement of high-carbon soldering iron zero orders will be stopped, and the domestic long-term association’s purchases in the month will be cancelled, and the supply will be resumed later.

According to industry insiders, this is related to the sluggish market conditions and frequent transactions at low prices. The recent market situation of ferrous metal smelting and rolling processing industry such as iron and steel is not optimistic. According to data released by the National Bureau of Statistics, at the end of May, the number of loss-making enterprises in the ferrous metal smelting and rolling processing industry was 1,784, and the total loss of loss-making enterprises was 28.18 billion yuan, an increase of 338.3% year-on-year. At the same time, a total of 25 listed steel companies in A-shares released their performance forecasts for the first half of the year, of which 20 steel companies have pre-reduced, including 1 loss increase and 4 first loss.


At present, the profitability of steel companies has dropped from 83.55% at the end of the first quarter to 15.15%. Such bloody data is also very consistent with the situation that 22 steel companies in Inner Mongolia, Tianjin, Hebei, Shaanxi and other places responded to the “blood deficit” by shutting down for maintenance and other methods. Slumps, losses, new lows… Many industries have “collapsed” In fact, the current loss situation does not only exist in the steel industry. In the second half of the year, the global commodity market has changed its previous strong shock pattern and entered a downward shock channel. Coal, cement, chemical industry and other industries have been hit by the continued lack of downstream demand, and production and operation have approached the red line of profit. Under the emergency situation of blood loss or facing loss, many industries have taken common measures to deal with it – price reduction. Steel: Spot steel fell by 14% during the year, and scrap steel prices hit a new low for the year. At the end of June, the spot steel price index was 1133 points, down 16.57% year-on-year. In the first half of 2022, steel prices fell by 3.9% cumulatively, down 11.14% from the highest point of the year. The price of domestic iron concentrate decreased by 7.54% month-on-month, the price of CIOPI imported ore decreased by 4.60% month-on-month, and the price of coking coal and metallurgical coke decreased by 3.41% and 1.53% month-on-month respectively. The current spot steel price index is 1008 points, down 14.5% from the beginning of the year . In the secondary market, as of the close on July 25, the A-share market steel sector index (Shenwan) has fallen by 14.04% during the year. In terms of scrap steel, the price dropped by 7.21% month-on-month, a decrease of 3.35 percentage points higher than that of the previous month. Hunan scrap prices hit a new low this year last week. From July 8th to July 16th, scrap purchase prices of Hunan steel mills plummeted. Hunan Liangang reduced a total of 590-720 ¥/t, and Hunan Xianggang reduced a total of 760-900 yuan. Yuan/ton, Hunan Henggang has lowered the accumulative amount by 590-650 ¥/t, and Hunan Cold Steel accumulatively reduced the accumulative amount by 520-790 ¥/t.

Industrial Metals: Multiple metals hit their biggest quarterly drop in at least a decade On July 1, copper prices hit a 17-month low, briefly falling below $8,000 per ton, before collapsing again on July 5 and closing down more than 4% to hit 2021 The lowest level since the beginning of the year, the second quarter tumbled 20%, the worst quarter in a decade. Shanghai copper fell from 73,120 yuan / ton to the lowest point of 55,510 ¥ in just one month, a drop of 24%

In the first half of this year, tin prices stagnated after a surge, but eventually fell back quickly. The impact of macro events exceeded expectations, the strong recovery of consumption weakened, and a large surplus became a foregone conclusion, and the price of tin fell by about 40%. Benchmark aluminum on the London Metal Exchange recently fell to a low of $2,352 per ton, the lowest price since May 2021 (14 years), and the price fell to $2,370 per ton, following a 30% drop in aluminum in the second quarter. The Federal Reserve continued to raise interest rates, leading to a sharp drop in the second quarter of lead prices in London, with the price dropping to a low of $1,883 per ton, the largest quarterly decline in at least a decade in the second quarter of 2022. Zinc prices fell sharply one after another, the latest hitting $3002.5/t , down 19.69% in June, and 25% in the second quarter. In the case that LME zinc continues to rise and the price premium is squeezed higher, the Shanghai-London ratio has refreshed a record low. Coking coal: plunged 30% in less than two months. Since June, the cumulative decline of coking coal has exceeded 30%. The coking coal industry held an emergency meeting to limit production. Participating companies reached a consensus including limiting production by more than 50% from now on, driving companies in the same region to jointly limit production, and immediately stopping or reducing all coal purchases. According to data from the National Bureau of Statistics, the national coal price mainly fell in mid-July. The specific price changes of various coal types are as follows: the price of anthracite (washed block, volatile matter ≤8%) was 1714.3 ¥/t, down 143.2 ¥/t from the previous issue. tons, down 7.7%. The price of Shanxi excellent mixed coal (high-quality mixed coal, calorific value of 5500 kcal) was 1245.7 , down 1.4 yuan/ton or 0.1% from the previous issue. The price of Datong mixed coal (mixed coal produced ¥/t n Datong, with a calorific value of 5800 kcal) was 1335.7 ¥/t , down 1.4 ¥/t or 0.1% from the previous issue. The price of coking coal (main coking coal, sulfur content <1%) was 2540.7 ¥/t, down 234.3 ¥/t or 8.4% from the previous issue. In addition, in mid-July, the national coke (secondary metallurgical coke) price was 2787.2 ¥/t, down 156.8 ¥/t or 5.3% from the previous issue. The fourth round of coke price cuts came to fruition quickly, and the market still expected the fifth round. The overall operating rate of coke enterprises declined and shipments slowed down. The average auction transaction price of low-sulfur main coking raw coal in Linfen, Shanxi Province decreased by 62¥/t compared with last week's transaction price, the execution price of Lvliang Liulin high-sulfur thin coke was 1,600 ¥/t , and the auction transaction price of a mainstream coal company in Qipanjing, Inner Mongolia, decreased by 300 ¥ from the previous period -420 ¥/t.

Cement: The highest price fell by 235 ¥/t , and the price of cement in 14 regions dropped by more than 100 ¥/t . According to the price information in the circulation field of the National Bureau of Statistics, P.O42.5 bulk cement reported 480.9 ¥/t in mid-March 2022, the highest in the first half of the year. The price is reported at 377.8 ¥/t in early July 2022, which is a relatively low price, and the difference between the high price and the low price is more than 100 ¥/t . From mid-February to early this month, cement prices in 14 regions including Heilongjiang, Anhui, Shaanxi, Chongqing, Qinghai, and Zhejiang in 31 provinces, municipalities and autonomous regions across the country fell by more than 100 ¥/t. At present, the cement industry is in the traditional off-season, downstream demand continues to be sluggish, and the warehouses of cement enterprises in many regions are full. Market demand is poor, and prices continue to decline. Energy: International crude oil, natural gas, etc. all plummeted, dominated by bad news, and international crude oil showed a volatile downward trend as a whole. Recently, the two crude oils once fell below the $100/barrel mark. Since the peak in early March, WTI and Brent crude oil futures have fallen by 25.6% and 28.6% respectively, and U.S. natural gas has plunged by more than 32% last month. Agricultural products: fell 18% in a single month, the largest decline in a decade. Since the last 10 days of June, macroeconomic concerns have been dominating the price trend of agricultural products. Market volatility has limited traders’ volumes, with prices of wheat, corn and soybeans all falling back to levels last seen in January-February this year. Chicago wheat futures fell 18% in June, the largest monthly decline since 2015; corn futures fell 18% in a single month, the biggest drop in a decade; soybeans fell slightly better, but also reached 13%. The prices of coffee, sugar and cocoa also fell. Paper industry: 81 paper companies lowered their selling prices, and the prices of some products fell by 100 yuan/ton. The corrugated paper market was weak, and the overall pressure was down. The focus of transactions was lowered by 30-100 yuan/ton. The average weekly market price of 120g AA corrugated paper in China was 3,573 ¥/t , down 15 yuan/ton from the average price of the previous period, down 0.42% month-on-month, 0.60 percentage points lower than last week, and 6.39% year-on-year. The containerboard market fell more and rose less, and the low-end kraft cardboard fell by 50-100 ¥/t. The weekly average price of the market was 4809 ¥/t , a decrease of 0.15% from the previous month. The national waste market has been completely occupied, and Nine Dragons’ bases have once again led to a sharp decline. Dongguan Nine Dragons has lowered twice a total of 100 ¥ / t, and Guangdong has followed the decline for two rounds. Panic shipments overnight, and even packing stations stop receiving goods to reduce risks. Tire: The price has dropped slightly, and the price reduction has become popular in disguised form. From March to May this year, dozens of tire price increase notices will be sent out every month, but after entering June, the price increase notices of enterprises are becoming less and less. Many stores even adopt the method of “disguised price reduction” to sell tires, including promotions, buy gifts, and spike activities. In terms of passenger car tires, the wholesale price of some products in the southwest area of Dunlop was slightly reduced by 5-8 ¥ per piece; the Giti factory launched 618 promotions for retail channels through the “Win Together” APP, and some agents synchronously designated products to give special prices or amounts Promotion, the wholesale price fell by 15-49 ¥ / piece. In terms of commercial vehicle tires, the Hankook East China market has dropped 30 ¥ per tire this month after a sharp increase in prices last month. Cotton: The price hit a new low this year, down 3,300 ¥/t from the previous month. The domestic cotton market continued to be weak, and at the end of June, it was the lowest since this year at 18,325 ¥/t. At the end of June, the China Cotton Price Index (CCIndex3128B) was 18,369 ¥/t , down 3,150 ¥ from the previous month; the monthly average price was 20,402 ¥/t , down 1,720 ¥ from the previous month. The transaction price of domestic long-staple cotton grade 137 at the end of June was 49,000 yuan / ton, down 3,300 ¥ from the previous month. The off-season of textile enterprises continued, the operating rate was insufficient, and downstream orders were weakened. At present, domestic sales orders are scarce, and export orders for foreign cotton continue. In terms of futures, cotton yarn futures fell sharply with Zheng Mian, and the settlement price of the main cotton yarn 2209 contract was 20,490 ¥/t, down 2,680 ¥/t from the weekend of the previous week. Chemical industry: plunged 9,000 ¥ / t, and the prices of dozens of products fell. Recently, the chemical market changed sharply, and the prices of dozens of chemical products showed a downward trend. Among them, isobutyraldehyde, propylene oxide, n-propanol, neopentyl The ton price of various chemicals such as alcohol and isooctanol fell by more than 1,000 ¥

Propylene oxide is currently quoted at 9,600 ¥/t , down 9,300 ¥/t or 49.21% from the beginning of the year; isobutyraldehyde is currently quoted at 7,566.67 ¥/t , down 6,633.33 ¥/t from the beginning of the year, or 46.71%; hydrogen peroxide is currently quoted at 823.33 ¥/t , down 606.67 ¥/t , or 42.42% from the beginning of the year; neopentyl glycol is currently quoted at 11066.67 ¥/t , down 5683.33 ¥/t from the beginning of the year, or 33.93%; hydrochloric acid is currently quoted at 196.67 ¥/t, compared with The price at the beginning of the year fell by 90.83 ¥/t , a decrease of 31.59%; the current price of n-propanol was 8216.67 yuan/ton, a decrease of 3583.33 ¥/t compared with the beginning of the year, a decrease of 30.37%; the current price of isooctanol was 8466.67 ¥/t , a decrease of 3366.66 from the beginning price Yuan/ton, a decrease of 28.45%; acetone is currently quoted at 4840 ¥/t , down 1660 ¥/t from the beginning of the year, a decrease of 25.54%; chloroform is currently quoted at 2850 ¥/t, down 800 ¥/t from the beginning of the year, a decrease of 21.92 %; propylene glycol is currently quoted at 8933.33 ¥/t , down 2400 ¥/t or 21.18% from the beginning of the year; epoxy resin is currently quoted at 18250 ¥/t , down 4750 ¥/t from the beginning of the year, or 20.65%. Demand continues to be sluggish, and many industries collapse across the board! Global economic growth has slowed down, and the market’s “recession transaction” has begun to heat up. It is believed that future demand will become weaker, and the marginal support for commodity prices will weaken. Superimposed the new crown epidemic control measures in some Chinese cities in the first half of the year, all have a bear market impact on commodity prices. That is to say, with the end of the “bull market”, the falling prices will form a domino effect and drive more and more companies in the upstream and downstream of the industrial chain to fall into the abyss of cold demand. From the shortage of orders, to sales at reduced prices, to bankruptcy at a loss, it is only a matter of time before a series of chain reactions occur. For many industries such as coatings and chemicals, this is a time to test the capital chain and competitiveness. The pace of industry reshuffle and survival of the fittest is gradually accelerating.