Commodity prices remained stable in July as a whole

In July 2019, the downward trend of domestic economy slowed down. The commodity market was affected by high temperature and rainy weather. The characteristics of demand in off-season were obvious and the accumulation rate of inventory was accelerated. However, with the support of the policy of environmental protection and production restriction and high production cost in the northern region, the growth rate of market supply slowed down, and commodity prices also showed some resilience. 。 According to the market monitoring of China Logistics Information Center, in July 2019, the average price of commodity market as a whole remained basically the same as last month, stopping the trend of continuous decline in the previous two months, but the cumulative average price in January-July was still 2.1% lower than that in the same period last year, and the decline was 0.1 percentage point larger than that in January-June.

From the perspective of major industries, the prices of ferrous metals and finished oils have rebounded, rising by 0.2% and 2.1% respectively compared with the previous month, while the prices of other products have declined in varying degrees. The prices of non-ferrous metals, chemical industry and raw coal have fallen by 2.1%, 1.1% and 0.5% respectively compared with the previous month.

Specifically:steel market, affected by the policy of environmental protection shutdown and production profit decline and other factors, steel output has decreased significantly. July is in the off-season of traditional steel market. Under the influence of high temperature and rainy weather, outdoor construction is obviously affected. Steel terminal sales are cold. Except for some just needed, market reserve and speculative demand are low, and trading is low throughout the month. Generally speaking, both supply and demand in the steel market are in a downturn and stocks continue to accumulate. However, due to the high price of raw materials such as iron ore, steel prices are supported to a certain extent. The average price in July rose by 0.2% annually compared with the stop-fall. In terms of refined oil products, crude oil prices rose sharply in early July, driven by a series of news, such as the attack of Middle East tankers, the decrease of U.S. crude oil stocks, the continuing tension between the United States and Iraq, and the possible interest rate cut by the Federal Reserve.

Affected by this, domestic refined oil prices rose slightly in July. On the domestic market, the second batch of import quotas of refined oil were issued in 2019, boosting the enthusiasm of the main production, and crude oil processing volume rose year-on-year in June. However, due to the refinery's adjustment of variety ratio, the output of gasoline declined significantly, resulting in a significant reduction in gasoline production, while the output of diesel oil also decreased slightly, resulting in a slight reduction in diesel output. On the other hand, although the demand for diesel fuel is restrained by the high temperature and rainy weather, the overall market turnover is better than expected in the late boom atmosphere. Taken together, the average price of refined oil in July recovered by 2.1%. For non-ferrous metals, although there are many interference factors at the end of the mine and the supply is tighter than that at the earlier stage, the overall pressure is still high. Demand continues to be depressed due to the increasing downward pressure of the economy, the slowdown of real estate investment growth and the regulation and control policies of the real estate market. The market is still a weak pattern of supply and demand. The average price has declined for the fourth consecutive month, falling by 2.1% in July, an increase of 1.5 percentage points over the previous month. In terms of varieties, zinc prices were affected by the rising US dollar index, the new high output and the sharp increase in inventories, with the largest decline of 5.3%. In the market of chemical products, domestic factories are affected by the pressure of environmental protection, with low start-up rate and tight supply.

The downstream is affected by the off-season and the demand is weak. In July, the domestic chemical product market continued to operate weakly. The average price has been declining annually for four consecutive months. This month's decline is 1.1%, which is 0.4 percentage points narrower than last month. In the coal market, the release of coal pipe tickets in July in Yulin area of Shaanxi Province led to the continuous growth of coal production. In addition, the overall coal price is at a high level, the profit of coal production is good, and the production enthusiasm of enterprises is high. In addition, the coal production of Shanxi and Inner Mongolia, the two major coal producing areas, also rebounded rapidly, leading to coal production. Market supply pressure is high. In July, the market should have entered the peak consumption season, but due to the economic downward pressure, the low temperature in the southern region caused by El Nino and the sustained growth of new energy power generation, the growth of demand for electric coal and overall power coal is limited. In a word, the relationship between supply and demand in the domestic coal market has gradually shifted to relaxation. In July, the average price of the coal market dropped by 0.5%, which was 0.1 percentage point larger than that of last month.