Steel Prices Continued To Fall For 4 Weeks &Nbsp, And Steel Traders Lost More Than 7 Of Their Profits.

Because steel mills are often short in the futures market, many traders who are looking for steel prices have suffered heavy losses in the spot market since August.

Fang Chunquan is one of the hundreds of steel traders in Chengdu who are losing money.

He said that steel prices have fallen by 1000 yuan / ton, almost seven or eight of this year's profits have been lost.

But now, the upside down of spot price and cost price and high inventory make them still fail to see the hope of profit.

New materials Co., Ltd. General Manager recalled that just four weeks, with the spot price of steel from 4500 yuan / ton diving all the way to today's 3600 yuan / ton.

"Most steel traders have been returned to their original form, almost losing the 70%-80% of a year's profits."

Who has pushed steel prices plummeting?

Some voices pointed out that the reason for the sharp fall in steel prices was the impact of supply and demand.

But the question is, why did demand not flourish until August?

Zhou Ming, director of Huaxi futures product development department, noticed the strange changes in the steel futures market in August.

He said that when the steel thread of steel futures climbed to 4500 yuan / ton, a large number of short selling plates began to emerge.

Since then, although the price of rebar futures has reached a high level of 4900 yuan / ton, the continued selling of short selling has increased the upward pressure on steel prices.

"A large number of short selling plates on the futures market are behind the mills."

Zhou Ming said that in order to avoid risks, steel mills began to sell short in the futures market, using spot spreads and futures spreads to hedge.

Just as steel mills began to look at the market a lot, steel traders got the wrong information.

As a result, a large number of steel traders were hoarding, and steel mills were willing to sell at high prices and backhand in the futures market.

Finally, steel mills, who control the source of steel supply, laughed until the end, but steel traders could not get out of the slump market.