Because of stocking the market sentiment, market prices continue to rise; plus 2 consecutive months of decline in stocks, the market needs to be re-optimistic; plus the expected power rationing policy Backward effect and issued by the provinces plan also makes businesses more likely to "advance"must rise space. According to the present situation, not surprisingly, the market prices will have risen, but to be alert to the risk of higher prices after the decline, in particular, need to focus on changes in the external economic environment. Is this wave of increase to have much, if continued until the end of May.

First, due to the raw material prices high consolidation steel prices rise again.Raw material prices experienced in March, after a brief pullback, rise again in April, a high level consolidation, the current wet-based Tangshan Iron Concentrates 66% mainstream price is not included factory 1080 ~ 1100 yuan / ton, 63.5 high taste fine ore in India port price of 188 ~ 190 remain USD / ton; billet in Tangshan area north of 4,500 yuan / ton, Jiangsu billet price 4600 yuan / ton. In the same time, steel prices are also slowly picking up with the market and the leading steel plant in East China has substantially increased prices 4 at the end, of which 20 mm and 6.5 mm HPB235 HRB335 rebar high prices back in line 4900 ~ 4950 yuan / ton, but also an environment with fewer resources to bring to the market reason to continue to rise.

Second, the limited power policy and the elimination of outdated Zaixi Steel City, is expected to reduce the supply outlook .Since late April, May domestic provinces and cities will once again usher in restrictions on electricity policy, steel industry was shocked to be the first limit of the column, which undoubtedly will affect the release of steel production capacity, each market has began to spread in May discounted supply of news resources, which have a greater impact in Jiangsu, Hebei, Jiangxi, Hubei; and into May, the provinces in 2011 introduced plans to eliminate backward production capacity. In 2011, China's steel industry plans to phase out backward production capacity of 26.53 million tons iron, phase-out than last year's 3.47 million tons reduction; plans to phase out backward steel production capacity 26.27 million tons, compared with last year's 15.5 million tons out of the task increased. Among them, steel-making capacity in Hebei Province plans to phase out 15.5 million tons, accounting for the total phase-out of steel production capacity 59%. It is clear that resources will arrive in May is expected to significantly reduce the depth of the market business has been expected, will reduce the supply of steel production will lead to higher prices.

Third, the futures spot price premiums, policy and strong external environmental uncertainty April futures prices remain volatile during the uplift, but the futures price to 4 at the end of the spot price is still low compared to the lowest in the Shanghai market three domestic steel 4,850 yuan / ton, the main force of the screw near the 1110 contract in 4915, total price by the pound than the futures price exceed the spot price of about 100 yuan / ton. View the current situation, futures prices are the bounds of reason to catch up, but the whereabouts of a breakthrough after 5000 is questionable. One policy that is the capital side in May will continue to appear; second external situation, especially U.S. policy in May also has great deal of uncertainty, which will undoubtedly affect the price of the commodity disk.

The next shock will be the domestic construction steel prices rose mainly may exceed the price of the high points during the Spring Festival, but also at any time by policy factors carefully the potential risks of the callback. Coupled with recent market transactions has begun to wane, the market has increased relative to wait and see mood, if the recent decline in stocks was not enough, pessimism is likely to boost the market increased, prices fell, the high is expected to be seen Recently, however, can reach, to be watching.