Short term steel fundamentals are weak, and steel consumption has entered a seasonal off-season

According to a research report by Minsheng Securities, the demand for steel is gradually entering the off-season. Although the apparent consumption of threaded steel has rebounded compared to the previous week, it is mainly due to the flow of resources between regions, resulting in an increase in apparent consumption and a weakening of sheet metal consumption this week. On the supply side, the production of large steel products declined this Friday, as some steel mills' profits are still near the breakeven line, and production may rebound again in the later stage. In terms of inventory, there was a slight decrease in factory inventory this week, mainly due to the reduction in inventory contributed by threads, and social inventory began to build up slightly. Overall, the short-term fundamentals of steel are weak, and steel consumption has entered a seasonal off-season. Attention should be paid to the marginal impact of energy conservation and carbon reduction on the supply side and the relaxation of real estate policies on the demand side in the later stage.