Logic: Yesterday, the black system as a whole maintained a narrow swing situation, the negative feedback pattern of the industrial chain was broken by the Tangshan area "crude steel flat control" policy, iron ore far in the non-mainstream mines and domestic mines after the production cost area stabilized, but the real end of iron ore demand is still facing policy production limits and steel mills loss active production reduction pressure and iron ore supply end is in a recovery cycle, the fundamentals have not bottoming out, A double dip is possible on the disk.
Supply side: mainstream mine shipment recovered to a high level, Brazil, non-mainstream side maintained a stable growth situation; The inbound volume was eliminated by the previous cyclone, the inbound volume picked up significantly, and the actual supply of imported ore picked up.
In terms of demand, "crude steel flat control" policy in Tangshan region stimulates steel prices to rise, some steel mills plan to resume production or finish overhaul in advance, short-term demand decline speed or slow down; In the medium term, the crude steel flat control policy will lead to a significant decline in iron ore demand, long-term demand is still more pessimistic.
In terms of inventory, steel mill inventory maintains a low inventory structure. After the policy boosts the price of finished materials, steel mill replenishment action is still weak, more on demand replenishment. However, steel mill production reduction action slows down, which may delay the port inventory into the accumulation cycle.
Opinion: iron ore tends to be loose in the medium term, the short-term demand side down or slow down, the medium-term fundamentals of iron ore have not been driven upward, short-term by the valuation boost and the impact of technical repair demand appeared to a greater extent, it is suggested to take the opportunity to short allocation.
Late concern/risk factors: price regulation, mainstream mine delivery, steel mill profit level.
