The domestic futures market dived on the night of May 19, with black series, chemicals, agricultural products and other futures falling collectively. By the end of the night, coking coal fell by 7.98%, iron ore by 7.92%, steam coal by 7.81%, hot rolled coil by 7.21%, rebar by 7.07% and coke by 6.45%. Chemical products and agricultural products fell, glass fell 6.06%, soda fell 5.33%, methanol fell 4.97%; Palm oil fell 4.17% and soybean oil fell 3.89%.

Premier Li Keqiang presided over an executive meeting of the State Council on May 19 to make arrangements to ensure the supply and price of bulk commodities and maintain the stable operation of the economy. The meeting pointed out that since the beginning of this year, affected mainly by multiple factors such as international transmission, the prices of some commodities have continued to rise, and the prices of some varieties have even reached new highs. We should attach great importance to the adverse effects of rising commodity prices, implement the deployment of the Party Central Committee and the State Council, according to the requirements of precise regulation and control, focus on market changes, implement comprehensive policies, ensure the supply of bulk commodities, curb their unreasonable price rise, and strive to prevent transmission to consumer prices.

This is the second time that the executive meeting of the State Council has focused on the issue of commodity prices in seven days. On May 12, the executive meeting of the State Council held a request to track and analyze the domestic and international situation and market changes, and effectively deal with the rapid rise of commodity prices and its associated effects.

According to the price monitoring of the business community, in the spot market, the prices of nearly 100 kinds of raw materials have declined since May 12, of which 44 kinds have dropped by more than 3%. The top three commodities in the decline are hot rolled coil (- 12.67%), acetone (- 10.06%) and n-butanol (- 9.11%).

The Business Association believes that the reason for the decline in the prices of these raw materials is related to the imbalance between supply and demand caused by the high prices of the downstream terminals. In addition, from “straight into the sky” to “steep decline”, the sharp decline of raw material market is inseparable from the supervision of relevant departments, which shows that the current regulators are determined to curb the rapid rise of bulk commodities. It is expected that the commodity market will gradually return to the balance of supply and demand, and the growth rate will also fall.