At the 2013 China Steel Market Outlook and the “My Steel†annual meeting held yesterday, Zhang Changfu, secretary-general of China Steel Association, summarized the dilemma faced by steel companies this year. On the one hand, the operation is more difficult, while on the other hand, Overcapacity has intensified.
Zhang Changfu pointed out that from January to October this year, the average sales profit rate of China's key large and medium-sized steel enterprises was only -0.18%, which was generally at the break-even point. From January to October this year, the overall price of steel has fallen to near the level of 1994, and the price of sheet metal in August fell below the level of 1994. However, the fixed asset investment in the steel industry has remained at a high level this year. From January to October, the total investment amounted to 414.27 billion yuan, a year-on-year increase of 3.9%. Although the growth rate dropped significantly, the investment amount has exceeded the level of 386.05 billion yuan in 2011. “This will obviously further aggravate overcapacity.†Zhang Changfu pointed out that in the new investment in the steel industry, the investment in non-state-owned steel enterprises increased significantly, the investment amount increased by 46.6% year-on-year, and the investment in state-owned steel enterprises decreased by 10.5%. From the production point of view, this year is also the increase in production of small and medium-sized enterprises, key enterprises to reduce production, from January to October, the crude steel output of key large and medium-sized steel enterprises fell by 1.2%, the output of crude steel of small and medium-sized steel enterprises increased by 20.3%, accounting for the national coarse The proportion of steel production reached 18.0%, an increase of 2.7 percentage points year-on-year. In this regard, the internal manager of a private steel company told reporters that compared with some state-owned large steel enterprises that produce more plates, the profit margins of private steel companies that mainly produce long products are relatively large, and the production scale of these enterprises is often not Large, and only expansion of the production line, it is possible to further reduce costs and earn more money. In addition, compared with some large steel companies that are not allowed to approve new steel projects in principle, local small steel companies are more likely to privately open new projects, and once these projects are launched, they cannot stop investing in a short period of time. However, Zhang Changfu expects that from the recent domestic market situation, as the country's various steady growth measures are gradually in place, the investment in capital investment and infrastructure construction has accelerated significantly, which has brought signs of recovery to the steel market. The output of crude steel will increase by about 2%, and the apparent consumption of crude steel will increase by about 3%, slightly higher than the increase in 2012. According to the forecast of China Steel Association, the full year of 2012 Production will reach 732 million tons, an increase of about 3% year-on-year, and this year's apparent crude steel consumption was 679 million tons, an increase of about 1.8%. A large steel trade company in Shanghai told reporters that in the past two or three years, the company has generally received many orders for the second year in this quarter, but so far this year, there is not one ton of orders in the second year. In this regard, Shi Hongwei, director of the Metallurgical Industry Economic Development Research Center, pointed out that if China basically completes industrialization in 2020, and annual steel consumption will increase by 2%, China's steel demand will continue to rise in the future, but it must be low-speed growth. However, Shi Hongwei expects that due to the steady demand for ore in China and the slowdown in global iron ore demand growth, coupled with the release of foreign iron ore production capacity in the next three years, supply oversupply has emerged, so iron ore prices In general, it has entered the down channel. Since the beginning of this year, the price of raw fuel has dropped significantly. From January to October, the average price of imported iron ore was US$132.31/ton, down 20.6% year-on-year.
Zhang Changfu pointed out that from January to October this year, the average sales profit rate of China's key large and medium-sized steel enterprises was only -0.18%, which was generally at the break-even point. From January to October this year, the overall price of steel has fallen to near the level of 1994, and the price of sheet metal in August fell below the level of 1994. However, the fixed asset investment in the steel industry has remained at a high level this year. From January to October, the total investment amounted to 414.27 billion yuan, a year-on-year increase of 3.9%. Although the growth rate dropped significantly, the investment amount has exceeded the level of 386.05 billion yuan in 2011. “This will obviously further aggravate overcapacity.†Zhang Changfu pointed out that in the new investment in the steel industry, the investment in non-state-owned steel enterprises increased significantly, the investment amount increased by 46.6% year-on-year, and the investment in state-owned steel enterprises decreased by 10.5%. From the production point of view, this year is also the increase in production of small and medium-sized enterprises, key enterprises to reduce production, from January to October, the crude steel output of key large and medium-sized steel enterprises fell by 1.2%, the output of crude steel of small and medium-sized steel enterprises increased by 20.3%, accounting for the national coarse The proportion of steel production reached 18.0%, an increase of 2.7 percentage points year-on-year. In this regard, the internal manager of a private steel company told reporters that compared with some state-owned large steel enterprises that produce more plates, the profit margins of private steel companies that mainly produce long products are relatively large, and the production scale of these enterprises is often not Large, and only expansion of the production line, it is possible to further reduce costs and earn more money. In addition, compared with some large steel companies that are not allowed to approve new steel projects in principle, local small steel companies are more likely to privately open new projects, and once these projects are launched, they cannot stop investing in a short period of time. However, Zhang Changfu expects that from the recent domestic market situation, as the country's various steady growth measures are gradually in place, the investment in capital investment and infrastructure construction has accelerated significantly, which has brought signs of recovery to the steel market. The output of crude steel will increase by about 2%, and the apparent consumption of crude steel will increase by about 3%, slightly higher than the increase in 2012. According to the forecast of China Steel Association, the full year of 2012 Production will reach 732 million tons, an increase of about 3% year-on-year, and this year's apparent crude steel consumption was 679 million tons, an increase of about 1.8%. A large steel trade company in Shanghai told reporters that in the past two or three years, the company has generally received many orders for the second year in this quarter, but so far this year, there is not one ton of orders in the second year. In this regard, Shi Hongwei, director of the Metallurgical Industry Economic Development Research Center, pointed out that if China basically completes industrialization in 2020, and annual steel consumption will increase by 2%, China's steel demand will continue to rise in the future, but it must be low-speed growth. However, Shi Hongwei expects that due to the steady demand for ore in China and the slowdown in global iron ore demand growth, coupled with the release of foreign iron ore production capacity in the next three years, supply oversupply has emerged, so iron ore prices In general, it has entered the down channel. Since the beginning of this year, the price of raw fuel has dropped significantly. From January to October, the average price of imported iron ore was US$132.31/ton, down 20.6% year-on-year.
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