My life skills in Daming Liver

Ren Fu and Lin An have been busy with steel trade during this time.

Ren Fu was born in Tiangong Academy, and was part of the group that Su Ze personally ran the school.

When Su Ze opened Tiangong Academy in Nanjing, he enrolled a total of three batches of students. These three batches of students are now in the middle and upper levels of the southeastern industrial system. They are called the "old three generations."

When Ren Fu was developing steam engines, he often dealt with steel mills and had deep connections in this industry.

Although Ren Fu doesn't know how to use connections, Lin An is a qualified businessman.

One of the two is responsible for technology, and Ren Fu classifies and invests in steel products, identifying steel categories with rising potential.

Lin An is responsible for negotiating orders with these state-owned steel mills and using money to buy the future production capacity of these steel mills.

For steel mills, they also like customers like Ren Fu.

Steel production itself is highly cyclical.

Nowadays, some officials who study the economy call this periodicity the steel cycle.

When there is a lot of infrastructure on the market and steel is needed, it is impossible to increase the production capacity of steel plants all at once.

At this time, steel mills will invest in expanding production capacity.

By the time steel mills have invested in expanding production capacity, market demand has passed, or too many steel mills have expanded production capacity, and steel production has also increased.

At this time, the price of steel has dropped again, and the investment invested by steel mills in expanding production capacity has been poured in. It will take a long time to recover the cost.

When production capacity stabilized and new investments appeared, steel prices began to rise, and steel mills were unable to expand production capacity immediately, falling into the same cycle again.

This is the "steel cycle", which is why the demand for steel in the Southeast is rising rapidly and steel mills continue to expand production capacity, but the revenue of steel mills is still not hugely profitable.

For this kind of thing, the general office in charge of the steel plant has nothing to do.

Because of the existence of the steel cycle, the steel produced in the previous cycle has become inventory and is squeezed into the warehouse.

Before the inventory is digested, steel mills have no extra money to expand production capacity.

The emergence of Ren Fu directly hit the problem of steel cycle.

Although Renfu only needs special steel, the price of special steel is high!

Pre-sales of future steel products can provide additional liquidity to steel mills, so steel mills can expand production capacity in advance to cope with the next steel cycle.

The two parties hit it off immediately, so within the last month, Ren Fu received special steel orders from major steel mills for the next six months.

The reason why I only bought it for six months was because Ren Fu estimated that this round of steam engine craze would last for six months.

In six months' time, the production of special steel will also increase. At that time, the steel stockpiled will have to compete with the special steel produced by the steel mills, and the price will definitely fall back then.

After getting the order from the steel mill, Ren Fu and Lin An rented a small two-story shop next to the Shanghai Securities Exchange Center, hung up a steel trading market sign, and began waiting for customers to come to their door.

Everything went as Ren Fu expected. Starting from this month, many factory owners and businessmen saw the potential of steam engines, and also saw the huge profits of steam engines.

In fact, the front-end technology of the steam engine was basically completed by Su Ze. This was why Ren Fu was able to develop the steam engine at about the same time as Su Ze.

The principle of the steam engine is not complicated. The prototype invented by Su Ze is still on display in a glass cover in the square in front of the Crystal Palace.

Including the Songjiang Xu family, these businessmen sensed the same business opportunities as the looms of the past, and began to invest in the research and development of steam engines.

And when they started developing steam engines, they immediately discovered that developing steam engines required special steel.

Cylinders, pipes, and pistons all require special steel, and ordinary steel cannot withstand steam pressure.

After discovering this, they immediately went to major steel plants, but soon they discovered that all orders for special steel for the next six months had been bought up!

These workshop owners and businessmen who have invested in research and development will naturally not give up. After their inquiries, Renfu's steel trading center appeared in the industry's vision.

Everyone looked at each other in confusion. Could it be that Ren Fu purchased these steel materials to monopolize the steam engine?

But the government-run workshop can also produce, can he still have a monopoly on special steel?

Since it is a steel trading market, can it be traded?

The group of people went to Songjiang again and came to Ren Fu's steel trading market.

At this time, they discovered that Ren Fu did not want to monopolize special steel, but wanted to sell steel.

Even what he sells is not steel, but the bill of lading for steel.

At this time, the price of special steel spot products on the market has doubled!

The workshop owners in Su Song all have clear memories. When Su Ze promoted the water-powered mule machine in Su Song, those who were the first to follow Su Ze in investing in new machines became famous big businessmen in Su Song.

The steam engine is the next loom!

Whoever develops the steam engine first will definitely make the most money!

Orders for Ren Fu's steam engine workshop have been scheduled until next year, while the steam engines from the government-run workshop are not sold at all.

The price of spot special steel has doubled, but for the special steel order one month later, Renfu's price will only increase by 50%.

Some people were tempted, and the steel orders were sold out a month later.

Among this group of buyers, there are also smart people.

They also realize that if they can maintain the current spot price of steel, they can earn the price difference as long as they hold the pre-sale order until next month.

For example, the price of special steel when Ren Fu purchased it was 100, the current spot price of special steel is 200, and the futures price of steel one month after Ren Fu sold it was 150, then if this order is kept until next month, and it is still maintained At the current price of special steel, someone who spends 150 to buy it can earn 50.

This is 30% profit!

Although it is not as good as the 50% profit from Renfu's failed orders, the 30% profit is enough to drive many people crazy!

Most industries cannot achieve 30% profit at all, let alone 30% profit after one month. There is no cost at all.

The only cost is the money invested.

As a result, Ren Fu's special steel futures orders for one month later were sold out.

The spot products on the market are all sold secretly by Lin An.

When the two of them settled their accounts, they found that just the two months of steel production had allowed them to make back their original investment, and even make a surplus!

And the two of them still have special steel futures orders for the next four months!

Ren Fu and Lin An's breathing became rapid. Is there such an easy money-making business in this world?

Mr. Yu is really a genius!