The ferrous complex firmed on Friday May 28, 2021 as Chinese policy pushed the market around like flies to wanton boys. Spot firmed. Paper and steel jumped.
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China is wrestling with itself. On Friday we had this to lift prices:
China’s Ministry of Industry and Information Technology will seek to establish a mechanism to contain steel output based on carbon emissions, pollutant discharges and energy consumption, Shanghai Securities News said.
Then yesterday we had this to hit them:
China will tighten its crackdown on violations in the country’s capital market, an official with the country’s securities watchdog said Saturday.
These violations include fraudulent issuances, financial fraud, and market manipulation in the name of market value management, said Li Chao, vice chairman of the China Securities Regulatory Commission.
The commission will hasten the optimization of securities and law-enforcement systems and mechanisms, together with other relevant parties, Li said.
While continuing its supervision efforts and guarding against various kinds of risks, the commission will also resolutely delegate power to the market in fields where market mechanisms can play an effective role, according to Li.
More efforts will be devoted to enhancing supervision, transparency, and predictability to spur market vitality, he added.
Good luck sorting out these daily declarations. My focus remains on three points:
- Seasonal demand strength through Jul/AUG offset by possible further selling into EOFY.
- Prices hit hard in Sep/Oct with a downtrend establishing into 2022.
Sell the rallies.