🔹 Market Analysis:

1️⃣ Supply-Demand Imbalance Intensifies:

  • As we move into April, demand is expected to peak and then decline. The growth in hot metal production will likely outpace demand growth, leading to a supply-demand imbalance. This will create a cumulative contradiction, with slow inventory depletion, signaling a potential shift from gradual changes to a more significant fundamental shift.

2️⃣ External Tariff Risks Amplify:

  • The U.S. decision to impose a 25% tariff on imported cars signals a strong stance on global reciprocal tariffs. If this policy is implemented fully, it could have a substantial negative impact on exports, the economy, and market confidence.

3️⃣ Failure of Production Cut Policies:

  • The Ministry of Ecology and Environment announced on March 26 that the steel industry will be included in the “carbon trading” scheme, signaling the end of administrative production cuts for the year. Instead, carbon trading rules will take effect. The 2025-2026 period will mark the launch phase of carbon trading, which will have minimal impact on supply-side production in the short term. Therefore, no mandatory production cuts are expected this year, which is bearish for the entire steel market.

🔹 Trading Strategy:

✅ Main Strategy:

  • Consolidation expected for the short term. Trade within the range, with a focus on selling rallies during the price peaks.

⚠️ Risk Factors:

U.S. tariff decisions and their potential global impact may trigger significant volatility. Stay vigilant as policy and external risks unfold.

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