For more exciting content, come and follow my steel overview: as of November 28, 2023, MySSPIC scrap absolute** is 29388 yuan ton, month-on-month **683 yuan ton, an increase of 238%, a year-on-year decrease of 46 yuan tons, a decrease of 154%。In November, domestic scrap steel was slightly larger, the increase in finished steel was greater than that of scrap, the price spread of snail scrap expanded, the profits of steel mills were repaired, and the enthusiasm for production increased. Looking forward to December, with the support of macro good news and high iron ore levels, there is some support for rebar, electric arc furnace steel mills are actively producing, scrap demand is strong, and scrap winter storage has begun, and scrap steel has some support. Considering that the downstream demand for steel is mainly speculative, and the actual demand is still declining, the price difference of screw scrap may gradually narrow, and the scrap steel is mainly stable and consolidated. 1. As of November 28, the domestic scrap market was small, and the mainstream market rose by 20-80 yuanThe demand for scrap steel has increased, and the strong support of steel has been superimposed, and the overall trend of scrap steel has been revealed.
Table 1: Heavy waste in key cities across the country** (unit: yuan ton, excluding tax).
Data**: Ganglian data.
Second, in November, scrap steel imports continued to be upside down.
Figure 1: Spread between Japan's scrap imports** and the domestic mainstream market from January 2022 to November 2023 (unit: USD tonnes).
Data**: Ganglian data.
At present, China's imported mainstream material type, the current arrival price of HS from Japan is about 385 US dollars ton, the average price of heavy waste excluding tax in mainstream cities in China is 2560 yuan ton, and the CFR arrival price of imported mainstream material HS is about 180 yuan higher than that of domestic heavy waste.
III.1In the month, the domestic snail scrap price spread and plate scrap price spread expanded
Figure 2: Trend chart of snail scrap price spread and plate scrap price spread from January 2017 to November 2023 (unit: yuan ton).
In November, the rebar and plate were significantly larger, while the scrap steel was slightly larger, and the increase in finished steel was much greater than that of scrap, and the difference between screw scrap and plate scrap expanded at the same time. As of November 28, the absolute ** index of mysteel rebar was 407685 yuan ton, snail scrap spread 113805 yuan ton, an increase of 167 from the end of last month07 yuan ton, and the snail waste price spread reached a new high in the year on November 21. The absolute ** index of hot-rolled coil is 400212 yuan ton, plate scrap spread 106332 yuan tons, an increase of 91 from the end of last month16 yuan ton. The difference of snail waste and plate waste has increased significantly, and the profits of steel mills have increased significantly, especially the electric arc furnace steel mills have turned losses into profits, and the profits of valley electricity have even reached 300 yuan tons. The production enthusiasm of steel mills has increased. IV.1The monthly scrap-to-hot metal spread continues to narrow
Figure 3: Trend chart of pig iron and scrap price spread from January 2018 to November 2023 (unit: yuan ton) data**: Ganglian data.
As of November 28, the price difference between scrap and hot metal was -282 yuan ton, down 66 yuan ton month-on-month. In November, as iron ore continued to rise, the cost of molten iron in steel mills continued to rise, while the increase in scrap steel was small, and scrap steel and molten iron were greatly inverted. Due to the widening of the snail scrap price spread, the profits of steel mills have increased, and blast furnace steel mills have the willingness to increase scrap. Fifth, the fundamentals of scrap steel
1. Social inventories continue to decline and resource circulation is tight.
As of November 24, the scrap steel inventory of 584 enterprises in Mysteel was 1.01 million tons, down 1 from the end of last month90,000 tons, a decrease of 187%；The monthly processing volume was 2.86 million tons, a decrease of 30,000 tons or 1 from the previous month04%。Judging from the data, the social inventory and scrap processing volume in November have declined, due to the rapid fluctuation in the early stage, the market has reduced the social inventory to reduce the risk, and the resource side is still tight, which will also make the scrap steel will show a relatively strong situation. 
Figure 4: Scrap inventory changes of 584 scrap processing access bases from October 2022 to 2023.
Data**: Ganglian data.
2. The operating rate and capacity utilization rate of electric arc furnace continue to increase.
As of October 27, MySteel surveyed 87 independent electric arc furnace steel mills across the country, with an average operating rate of 7174%, an increase of 021%, an increase of 569%；The capacity utilization rate was 5305%, an increase of 109%, an increase of 479%。In November, due to the continuous expansion of the screw waste price spread, the profits of electric arc furnace steel mills turned losses into profits, and the profit of most steel mills was nearly 300 yuan tons, and the operating rate and capacity utilization rate of electric arc furnace showed a 6-week trend, especially the increase in capacity utilization rate. At present, most steel mills have reached production for a long time, but some steel mills still consider the lack of full-load production personnel and the problem of late sales of finished products, and are not at full capacity, and the capacity utilization rate of electric arc furnace is less likely to increase significantly. 
Figure 6: Utilization rate and capacity utilization rate of 87 independent electric arc furnace steel mills in 2023.
Data**: Ganglian data.
In November, under the influence of favorable macro policies, steel demand recovered, steel rose sharply, steel mills increased their enthusiasm for production, and scrap demand increased. Entering December, under the favorable macro policy, market confidence was boosted, and the recovery of steel demand also brought some confidence to the market. At present, steel mills are profitable, production enthusiasm is high, and scrap demand is also supported. The social inventory of scrap steel is at a low level, which supports scrap steel**. The market mentality has changed, Cong pessimism has turned into optimism, there is a situation of covering goods, scrap steel in December may be relatively strong, the snail scrap price spread will be narrowed, and the profits of steel mills will also be reduced. But everything will still return to reality, electric furnace production increases, steel demand can continue to improve, the north to the south to bring certain pressure to the market, on the whole, is expected to December scrap steel ** or will be stable in the consolidation operation.
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