Rebar prices are cautious in the short term, and will fluctuate in the medium term

After a brief decline in late April, rebar futures bottomed out in early May and came out of a wave of volatility. The highest price was once close to 3,600 yuan/ton, and then began to fall. As of May 28, the main rebar contract RB2010 closed at 3492 yuan/ton, an increase of 131 yuan/ton from the beginning of April, an increase of 3.89%.

The downstream demand for rebar is mainly in the real estate and infrastructure industries. From the published data, both of them show continuous improvement.

In terms of infrastructure, since the beginning of this year, domestic investment in infrastructure has been relatively strong. In April, the single-month growth rate of infrastructure investment for the first time turned positive to 4.78%, up 12.77 percentage points from March. In the government work report, although there are not many direct references to infrastructure, the policies proposed to increase the fiscal deficit rate and expand the scale of special debt are all good for infrastructure. According to the estimation of the fiscal deficit rate mentioned in the government work report expanded to 3.6% and the local special debt limit increased to 3.75 trillion yuan, the annual increase in infrastructure investment may be between 1.9 trillion and 2.7 trillion yuan The growth rate is between 10.5% and 14.7%.

In terms of real estate, a number of indicators continued to improve in April. Real estate investment in that month increased by 6.97% over the same period last year, and the newly started area decreased by 1.3% over the same period last year. Compared with March, they improved by 5.8 and 9.1 percentage points respectively. Judging from the information released by the government work report, the current policy-level keynote for real estate is still housing and housing, but the pattern of the real estate's recovery rebound in the later period will continue, and the whole year may show zero growth or a slight positive growth.

In the medium term, steel supply has entered a staged top zone, and there is limited room for the growth of long- and short-process steel production. On the demand side, in the second half of the year, there may be a trend of stable real estate investment and rapid increase in infrastructure investment. Therefore, in the medium term, rebar prices may continue to be dominated by strong shocks. However, in the short term, the market may face the effects of weakening macro sentiment and the impact of the off-season. Therefore, there may be a phased adjustment in the first half of June. In late June, if the industry logic is fulfilled, everyone may consider buying on dips.