&Ldquo; The commodities are completed in 2011&# 8217; The downward cycle (bear market) in 2015 entered a new upward cycle (bull market). Against the backdrop of global and China's macroeconomic stabilization, industrial and agricultural products will continue their upward trend this year despite supply contraction and rising inflation expectations& Rdquo; A certain securities representative. Electrolytic manganese powder

In 2017, the process of reducing production capacity in the steel industry will accelerate, and the effective production capacity may be reduced by 20 million tons. Next year's crude steel production may drop to less than 800 million tons, which is generally bearish on the demand for steel next year. However, the increase in steel brought about by PPP projects may not be able to offset the reduction in steel consumption in industries such as real estate. Both supply and demand have decreased, but the decrease in supply is greater than the decrease in demand, which is more favorable for prices. Electrolytic manganese powder

The upward trend of black series varieties is likely to occur. Before the Spring Festival, steel cost support is strong, and steel prices are expected to remain at a high level. There may be adjustments in the first half or second quarter of next year.

My chief analyst at Steel Network, Wang Jianhua, also agrees with the above concepts. Wang Jianhua said that commodities have entered a bottom-up cycle. In terms of the black series, from the supply side, the intensity of supply side changes in 2017 will not be small; From the demand side, the real estate sales area is expected to maintain an average annual sales area of 1.1 billion in the next three years; 1.2 billion square meters.

&Ldquo; Next year, the demand for steel in real estate will definitely show a significant decline, while; The Belt and Road’ There is great potential for exports along the route, and the steel industry will enter the stage of value return next year, namely‘ Raise the bottom, raise the average price, and reach a new high& Rdquo; Wang Jianhua said.

He further explained that 2016 was the most thorough year for industrial enterprises to destock, and it is still in the stage of destocking. It is about to enter a new inventory cycle, that is, actively replenishing inventory& Ldquo; The first half of 2017 is expected to enter the restocking phase, and the destocking process may be completed in the fourth quarter of 2016 or the first quarter of 2017. So, the rebound in steel prices is not yet complete& Rdquo; Wang Jianhua said.

At the same time, Wang Jianhua said that the recent policies are good for the black sector, such as attacking“ Floor strip steel”, If strictly enforced, the daily average steel production will be reduced by about 100000 tons& Ldquo; The highlight of the black series in 2017 is the supply side, with some short-term market support, and adjustments may only be made in March next year& Rdquo;

Futures analysts have analyzed the trends of coal, coke, mining, and steel next year. In 2017, the control of coking coal production was approximately relaxed, and the increase in coking coal production may reach 5%. However, due to the impact of steel production capacity reduction and environmental policies, demand has slightly declined.

&Ldquo; This winter and next spring, the demand for coking coal will slightly decline, and the supply of coal and coke will be relatively sufficient. The supply-demand contradiction will be gradually alleviated, but in the context of reducing production capacity, the price of coal and coke is estimated to be moderate and improving& Rdquo; The analyst said.

In 2017, iron ore will be the weakest link in the black chain. Yang Junlin said that in 2017, domestic iron ore production will continue to decline, with an estimated decrease of about 10 million tons of scrap ore for the entire year. However, the global supply of iron ore is expected to increase significantly, with an estimated increase of over 60 million tons, and most of it is high-quality ore.

Analysts predict that these mines require an additional 37.5 million tons of steel production to be consumed, and the supply side transformation of the steel industry will continue to deepen in 2017, which will be replaced by the 2016" Deproduction capacity; Evolve into&quo; Deproduction&rquo;, Increment is relatively difficult. Based on the release rhythm of mining production and the impact of steel environmental management, the price center of iron ore will be presented; High in front and low in back” The pattern of high prices is more likely to appear in the first quarter, and the high point will be around 80– 85 US dollars per ton.

&Ldquo; In 2017, the steel industry will enter a fundamental stage of reducing production capacity, and supply contraction will become the dominant factor in the market. The overall demand will remain stable, the supply-demand relationship will improve, and the center of gravity of steel prices will continue to shift upwards& Rdquo; Analysts believe that the approximate strength ranking of black varieties next year is steel, coal coke, and iron ore.

Steel enterprises should pay attention to purchasing raw material hedging

However, analysts also indicate that under the influence of policies and funds, the rapid rise and fall of the black series will become the norm, and investors should pay attention to grasping the pace and managing risks. Taking coal coke as an example, Yang Junlin believes that as the supply-demand contradiction alleviates, the tendency of coal coke weakens, and the volatility of the plate will also increase.

&Ldquo; In terms of operation, attention should be paid to the conversion of rhythm. Steel mills and coking plants can maintain short-term usage of coke and coking coal raw materials based on the actual inventory situation& Rdquo; The analyst said.

In Zhang Huaguo's view, the prices of coking coal and coke are better than those of steel due to the production capacity reduction effect in 2016, showing a phased mismatch between supply and demand, with a significant increase in prices and the possibility of adjustment. However, the extent of coke correction will not be too large, and the main focus should be on finding opportunities to buy and maintain value, while coking coal is also mainly on buying and maintaining value. If the timing is lower than the long-term contract price, the opportunity to buy and maintain value can be chosen.

&Ldquo; Due to the relatively high external dependence of iron ore and the depreciation of money, there is a structural shortage of high-grade ore. Therefore, it is important to focus on the timing of buying and hedging& Rdquo; Analysts say that the commodity cycle has transitioned from a bear market to a bull market, and we should try to find opportunities to go long.

Analysts believe that there are three common risk points in the operation of steel enterprises. One is that traditional forms of operation have drawbacks, namely traditional procurement&flash; Processing&flash; In the form of spot sales, the prices at both ends are influenced by the market, and the prices of raw materials, intermediate products, and waste products fluctuate and cannot be controlled during the consumption cycle. The second issue is that the procurement price of raw materials and the sales price of products are not synchronized in time. For example, for regular orders, the cost is certain, but the product price is uncertain. For long locked orders, the product price is certain, but the cost is uncertain (for long-term delivery). The third is" Negative Scissor Difference” Swallowing the profits of steel companies, for example, when steel prices rise, the increase in cost is greater than the increase in steel prices; When the steel price drops, the decrease in cost is smaller than the decrease in steel price.

According to the reporter's understanding, in response to these risk points, Nangang has explored several futures hedging strategies. For example, for long orders with fixed product prices but uncertain costs (distant delivery), buying iron ore, coke, coking coal, etc. to lock in the gross profit of orders; Inventory of scrap materials with certain costs and uncertain product prices compared to the policy. When the market price fluctuates significantly, choose to sell relevant futures types and lock in the sales price and gross profit.

&Ldquo; Due to the long-term upward trend of commodities, the hedging of steel companies in 2017 was mainly based on buying and hedging of raw materials& Rdquo; The analyst said. It is understood that this year, against the backdrop of continuous increase in raw material prices, Nangang has adopted a strategy of buying raw material to maintain value, which has achieved good results.

For example, in April 2016, Nangang signed an order with a gross profit of 208 yuan/ton, a spot raw material cost of 433 yuan/ton (53 US dollars/ton) for iron ore, and 900 yuan/ton for coke. Due to concerns about an increase in raw material cost, Nangang bought and built a warehouse in the futures market on May 10th. The construction price for iron ore was 354 yuan/ton (42 US dollars/ton), and coke was 903 yuan/ton. By August 22nd, the monthly average price of the Proctor index had risen to 61 US dollars per ton, and the purchase price of coke at Nangang in July had also risen to 1165 yuan/ton. The spot profit was reduced by 290 yuan/ton, and the spot order gross profit became a loss of 82 yuan/ton. However, due to Nangang's cessation of hedging on raw materials, the closing price of iron ore on August 22nd was 445 yuan/ton (53 US dollars/ton), and the closing price of coke was 1259 yuan/ton, with a floating profit of 378 yuan/ton in futures. Overall, Nangang achieved a profit of 296 yuan/ton for this batch of orders.

Analysts also believe that under the main line of supply side reform, steel companies should focus on buying and hedging. For example, steel companies need to buy and hedge raw materials to lock in lower costs, while trading companies need to buy and hedge future order volumes.

In addition to stopping buying and hedging raw materials, steel mills can also stop hedging profits next year, that is, virtual steel mills can maintain profits and lock in profits per ton of steel.

Analysts say that in 2017, steel profits were good, but the fluctuation in profits will also be relatively large. According to the 1705 contract for rebar futures, the current profit of virtual steel mills is over 400 yuan/ton& Ldquo; In 2017, the profit of threaded steel is expected to increase. Enterprises should choose opportunities with relatively high safety margins to build warehouses, which can be gradually increased in batches from low to high, and lock in the profits of virtual steel mills& Rdquo;

In addition, steel mills can also stop selling scrap products to maintain their value. For example, when the profit per ton of steel is too high and the market sentiment is extremely pessimistic (with continuous limit up or continuous positive line), it is possible to sell a small amount of product end inventory to maintain value.

&Ldquo; Considering the long-term upward trend of the market, steel mills should be relatively cautious in hedging the selling end, control the quantity, and not do it for too long& Rdquo; For example, analysts can say that under the recent efforts to organize and eliminate intermediate frequency furnaces, the price trend of rebar will still be relatively strong next year. Steel mills can only do phased selling hedging, and the proportion of hedging needs to be controlled. However, under the influence of automobiles, household appliances, and infrastructure, the price of hot coil will be relatively strong next year. Steel mills should try to minimize selling hedging in this category.

In the opinion of analysts, steel companies can grasp the basis return next year; Due to the influence of supply and funding, the timing of basis and price differentials for the black series will increase next year. For example, forward prices will seek balance in cost support, seasonality, demand release, and supply adjustment. The price trend will not be unilateral, but will intensify oscillation, more manifested as phased and constructive timing;.

Steel enterprise hedging, futures companies can; Give me a hand&# quo;

It is worth mentioning that, of course, participating in the futures market can assist enterprises in achieving the goal of "; Walking on two legs;, But currently, there are still many steel mills still; Walking on one leg&# quo;, They still aspire to futures hedging. A person from a steel enterprise in Shanxi region admitted at the meeting that their benefits have been very good this year, mainly due to their own coking coal, but now the monopoly of overseas mines is strengthening.

&Ldquo; The steel factory should be optimistic about the profits it has made this year, and may return them to the mine next year& Rdquo; He said that they are now eager to do hedging on iron ore futures and lock in raw material prices, but due to the lack of talent in this field and the management's lack of deep understanding of futures, they are unable to participate.

In fact, it is not only the steel enterprise in Shanxi that has encountered this dilemma. A person from a foreign-funded steel enterprise in Xuzhou informed reporters that they are also interested in futures hedging. However, due to the lack of professional talent in this field and concerns about who will bear the obligation of futures hedging losses, they have been slow to participate.

&Ldquo; Nowadays, some steel companies have some problems with their hedging concepts. They only think of futures losing money, but never expect that spot goods are profitable. The correct hedging concept should also consider futures as a sales channel, merging the profits and losses of spot and futures channels together. This is the correct way to evaluate& Rdquo; Futures analysts said in an interview with reporters.

Futures analysts say that commodity prices have fluctuated quite fiercely this year, with some steel companies only doing unilateral hedging and showing some losses. However, there have also been many successful experiences, such as establishing virtual steel mills and stopping the hedging of raw materials and waste products. This type of enterprise has been relatively successful this year.

&Ldquo; This year, Nangang has implemented hedging measures on both raw materials and waste products, achieving good results& Rdquo; Futures analysts say that they teach companies how to apply futures tools and teach them how to apply" Walking on Two Legs; It is the concept that Daotong Futures continuously adheres to.

According to the introduction, a large steel enterprise in Hebei region has made three requests to Daotong Futures this year: first, how to ensure the annual production and profits, second, how to lock profits above the overall industry profits, and third, how to deal with the risk points and financial pressure in the hedging process. In response to the request of this steel factory, Daotong Futures conducted some personalized hedging plans in the first half of this year, and achieved good results.

&Ldquo; Spot people only understand spot goods, while futures people only understand futures. Our goal is to enable enterprises to understand both spot goods and futures, and to bridge this bridge& Rdquo; Futures analysts have informed reporters that in the future, they will promote the development of steel industry funds, mainly engaged in futures and cash separation, basis arbitrage, etc., to assist enterprises in using futures tools to seize more opportunities and achieve more returns.