Recently, the logic of the strong performance of iron ore lies in the following points.

First, there is a reduction in supply. From the perspective of iron ore shipments, previous hurricanes had an impact on shipments, and from historical data, shipments in the first quarter were relatively small in a year. It is reported from Mysteel that on February 17, 2020, with the disappearance of tropical cyclone Damien, Rio Tinto is gradually recovering its iron ore business in the Pilbara region of Western Australia. Rio Tinto officials said that the cyclone affected its roads, electrical and communications infrastructure in the Pilbara region, and also affected its mine production in the region, which will take some time to return to normal. As a result, Rio Tinto has reduced its target shipments in the Pilbara region in 2020 from the original 330 million tons to 343 million tons to between 324 million tons and 334 million tons. Currently, Rio Tinto is strengthening cooperation with customers to minimize supply reductions. In addition, the impact of Brazilian floods on actual arrivals will be reflected in the future.

Second, demand reductions are not obvious. The production of the long process steel plant has never been stopped. Blast furnace production and coking plants cannot be stopped. There have been many reports that some steel mills have begun to reduce production or overhaul. Currently, the steel mills are reducing the output of scrap steel because the price of scrap steel is high and the molten iron produced is not suitable, so short positions based on this logic on iron ore will gradually Retreat. Moreover, the raw materials inventories of steel mills have almost been used up, resulting in increasing replenishment. Even if steel mills only replenish according to their demand, the replenishment amount will be large. However, steel inventories take up a lot of funds of steel mills, and the current liquidity of steel mills is insufficient, so short-term replenishment will be gradual and the volume will not be too large.

Third, it is not easy for steel mills to reduce production in the case of profit. According to calculations, the long process rebar cost in East China is ¥3,210 per ton, and the profit with tax of rebar is ¥230 per ton; the cost of hot rolled coils is ¥3,340 per ton, and the profit of hot rolled coils is ¥90 per ton. Recently, many people are discussing the reduction of steel mills. At present, from the perspective of the competition pattern of steel mills, because no steel mill is in a monopoly position, there is no case where one steel mill suspends production and other steel mills follows. Therefore, although it is necessary for steel mills to reduce production at present, in fact, steel mills will only choose to reduce production when they lose money. At present, what we are seeing is the conscious production limitation of steel mills, with a ratio of about 10%, mainly because the factory warehouse is full.

In summary, the short-selling power of iron ore comes from the decline in profit of steel mills. From the perspective of futures prices, only when the price of steel goes weak, iron ore price may drop. If the price of steel does not go down, it is hard for iron ore price to fall directly. In addition, the recent depreciation of the RMB is also one of the bullish factors.

In the short term, it is advised to focus on the following points: 1) the development of the epidemic. Japan is facing the test of the early stage of the epidemic. It needs to pay attention to how the number of confirmed diagnoses in Japan and China changes, and whether the resumption of work is going smoothly. 2) From the perspective of steel inventories, due to the large output of steel mills, the total steel mill inventories and social inventories of the five major steel types have reached historical highs in five years. In 2019, the domestic crude steel output was about 1 billion tons. There is a production inertia since January. Although most arc furnaces have been stopped, the output of the blast furnace is still very large. In addition, the Spring Festival of the Rat is early, and coupled with the impact of the epidemic, the holidays are longer, which has led to a long time window for inventory accumulation. The terminal factory and construction did not resume work as scheduled. Compared with the previous years, there was an increasing demand after the Lantern Festival. At present, the local government still needs various approval documents for resumption of work. Therefore, this year's restoration of building material demand will be 2 or 3 weeks later than in previous years. In addition, the arrival rate of migrant workers is relatively low, which can be seen from the extremely low level of traffic and daily consumption of the six major power plants. In general, it is normal for demand not to start, supply to remain stable, and record high inventories. In addition, the high rebar inventory may still be difficult to digest by mid-April, and inventories by that time are expected to be 3 to 4 million tons higher than the same period last year. 3) It is advised to focus on the price policy of mainstream steel mills in East China today and tomorrow to see whether steel mills will lower prices instead of holding the market.

从近期来看，铁矿石强势运行的逻辑主要在于以下几点。

第一，供应是有减量的。从铁矿的发运上来看，之前的飓风对于发货有所影响，而且从历史数据看，一季度的发运是一年当中偏少的。Mysteel据悉，2020年2月17日，随着热带气旋Damien消失，力拓（Rio Tinto）正在逐步恢复其在西澳大利亚州皮尔巴拉（Pilbara）地区的铁矿石业务。力拓官方表示，气旋对其在皮尔巴拉地区的道路、电气和通信等基础设施造成影响，同时也对其在该地区的矿山生产造成影响，需要一段时间才能恢复正常。因此，力拓将其在皮尔巴拉地区2020年目标发运量从原来的3.3亿吨至3.43亿吨之间降低至3.24亿吨至3.34亿吨之间。目前，力拓（Rio Tinto）正在加强与客户合作，最大程度地减少供应减量。另外，巴西洪水对于实际到货量的影响也会在未来有所体现。

第二，需求减量并不明显。 长流程的钢厂并不存在复工的情况，因为一直在生产，高炉生产是不能停，焦化厂也是如此！之前有很多消息说部分钢厂开始减产或者检修，钢厂目前先减少的是废钢部分的产量，因为废钢价格高，生产出来的铁水不合适，那么之前用这个逻辑去空铁矿的资金会逐步的撤退。而且，钢厂把原料库存消耗的差不多，导致不得不出来采购补库，即使仅仅按照需求来补货，量也不少。钢厂年前备货的铁矿库存已经消耗的差不多，但是因为钢材上的库存占用较多资金，现阶段钢厂流动资金不足，所以短期补货会循序渐进，量不会太大。

第三，有利润下，减产不容易。根据测算，华东长流程螺纹成本3210元/吨、热卷成本3340元/吨，螺纹含税利润230元/吨，热卷含税利润90元/吨。最近很多人都在讨论钢厂的减产，目前从钢厂的竞争格局来看，因为没有钢厂处于垄断地位，所以不存在一家钢厂停产，其他钢厂响应的情况。因此，虽然钢厂减产目前来看是有必要的，但是实际上只有当钢厂亏损时，钢厂才会选择减产。目前，我们看到的是钢厂在自发的限产，比例大概10%，主要原因是厂库放不下了！

总结来看，铁矿的做空动力来源于钢厂利润的下行，=从盘面来看，只有钢材价格弱势时，铁矿才会跟着下跌，钢材价格不跌，让铁矿独自领跌，暂时还是比较困难的！另外，近期人民币的贬值也是多头认为的利多因素之一。

之后我们需要关注的点主要在于：1）疫情的发展。日本 面临疫情初期的考验，需要关注日本以及国内的确诊人数如何变化，以及复工是否顺利。2)从钢材库存来看，由于钢厂产量比较大，钢材五大品种钢厂库存和社会库存总量已经创下5年来的历史高点， 2019年，全国的粗钢产量将近有10亿吨，那么从1月份以来的生产惯性还是有的，虽然大部分电弧炉是停产的，但是高炉的产量仍然很大！另外鼠年的春节比较早，加上此次疫情的影响，假期较长，那导致了一个很长的累库存的时间窗口。终端（工厂和工地）并没有如期开工，对比以前，元宵节过后是有需求启动的，而目前地方还是要各种复工文件审批，因此今年的建材需求恢复会比往年晚2-3周。另外外来务工人员到位率较低，这点从交通运量和六大电厂日耗仍然保持极低水平就可以看出来。总的来说，需求不启动，供应保持稳定，库存创新高是正常的。而且螺纹钢的高库存，可能到4月中旬还是难以消化，预计到时候比去年同期要高300-400万吨水平。3）需要关注这两天的华东主流钢厂出价格政策，看看钢厂是否会调低价格而不是托市。