Latest Trends about Steel from China in 2013

From an economic development perspective, the fourth quarter of 2012, China's economy has finally emerged tended to stabilize, but the economic stability of the foundation is not strong, is expected in 2013 or even longer, China's economy will remain stable, compared with the fast development momentum. Expected based on the above, it is expected that the China steel will enter a stage of total consumption of low growth, the domestic steel market in 2013 will show a slight price fluctuations, a stable trend of the overall operation, including iron and steel enterprise meager profit situation is difficult to be effective in improving.

The world economy continued weakness result in international steel prices fall, affecting China's steel imports and exports.

International Steel City, a drop in demand a direct impact on China's steel exports.In 2012, the weak international economy, international steel trade has shrunk dramatically intensified trade protection and trade friction, in October last year, China's exports of billet 5.14 million tons, 1-October total exports of 40.84 million tons. November, December remained practically monthly 400 million -500 million tons of export levels, and this trend continued until at least the middle of next year. This also shows that within the next two years, the balance between supply and demand of China's steel market depends mainly on the domestic market, and look forward to expanding exports to ease the pressure on the domestic market is unrealistic.

On the other hand, from the domestic point of view, the next time there is still a lot of uncertainties, but overall, in terms of domestic demand, the urbanization of the 48 put forward, people's living standards improve requirements from the ability of the consumer spending habits popularity continue to promote home appliances and consumer conditions, the industry's long-term growth space still exist. From the outside, we need to look at the international market environment is relatively stable, the recovery in demand in the United States, Europe stabilized, the Afro-Asian emerging market demand remains strong, the demand on the international market will remain basically the trend this year, is expected to export growth is expected to be flat with last year.

There will be a greater demand from the machinery industry point of view, the special properties of the steel products. The machinery industry demand for steel diversity, both ordinary steel, another high-value-added special steel. Currently, there is part of the special properties of the steel restricting the development of China's machinery industry, the much-needed iron and steel enterprises in research and development of these varieties of steel. Such as electrical equipment industry, some transformer oriented silicon steel, power station boiler heat steel, special steel pipe and other special welding electrodes for steel and other special steel imports; wear plate (thickness required and if the heavy machinery industry from 30mm ~ 120mm), special welding wire, bearing steel, etc.; Another example is General machinery manufacturing, material not only has a certain mechanical strength, but also have some of the resistance to chemical corrosion, wear and other special performance.

Comprehensive analysis, expected in 2013 Chinese steel production and apparent consumption increase, it will not reach a high level, still low growth, is still the total consumption, low-growth stage; 2013 domestic the steel market will show a small price fluctuations, the overall running stable trend, including iron and steel enterprise meager profit situation will improve.

Steel Storage Plan in Winter

The last month of 2012 is gradually drawing to a close, in the first three quarters of this year, steel prices all the way down to the steel trading business has lost confidence in the market, and even started to give up to save the steel tradition to continue for many years in the winter. However, yesterday's institutions in the industry predict that steel prices next year may per ton rose a few hundred dollars, to 4000 yuan. This can also be considered to be the most optimistic projections of future steel prices. Coupled with the recent steel prices have an upward trend, many Chinese steel traders and renewed enthusiasm.

The steel market in December, giving the feeling of a deviant help, absolutely no traces of common sense out the card, steel prices in the 12 in the coldest month of the year is enthusiasm, macroeconomic policies favorable raw materials market rally supportand peripheral capital markets drive up the various factors such as the impact of steel prices have a relatively objective of growth, but the volume has not been a corresponding increase analysis worried about weak demand in the terminal, the rise of steel prices depend on external influences,with no stability.

But towards the end, continue the favorable policies of steel industry, the steel prices showed signs of warming. Development Research Center of the State Council, Industry Vice Minister Yang Jianlong, 2013, in the Chinese economy run steady trend on the rise, real estate, automotive, infrastructure, electricity and investment will increase.Meanwhile, the export situation will be improved, the new orders index, new export orders index, purchasing volume index continued to rise, the basic consumption of steel inventories reflect the company's activities end.For this, the steel industry has been the basic realization of the process of bottoming out, and 2013 is expected gradual recovery.

The sheet market, the price of the first two ten-day month is mainly a rebound, but in the late early and long products began to enter the shock consolidation period; sheet market hot-rolled, galvanized steel sheet and plate or, rose more than 120 tons, its reasons in addition affected by the favorable impact of the industrial economy continued to pick up, pick-up in manufacturing industry boom driven by the related demand for steel, smooth release of the main factors, plus sheet stock has been in a low, so that inthis winter has characteristics significantly difficult or easy to rise.

Analysts say， the next spring steel prices will certainly rise, so as long as there is a steel trading business should not only make steel storage ，and stocking should as much as possible. However, there are a lot of people think that this does not work, because of the problems of many steel companies have capital chain tension, will bring a lot of risk if a large number of steel storage，therefore， for steel-commerce providers， they should be careful for steel storage in winter.

Steel market situation in China

Recently, the domestic steel spot market to pick up slightly, but the demand side is still a lack of strong support. The performance impact of each macro side fundamentals, China steel prices will be back shock pattern.

According to the monitoring, the domestic spot steel prices being "first growth and stable". Last week, affected by the good news of the macro side, the steel market confidence has been boosted, and steel prices generally rose slightly. However, due to the deep-rooted Steel City "off-season" effect, rising steel prices and lack of demand for support, the price of steel products stabilized again.

According to the analysis, in the sheet market, the overall situation is a sign of strength, reversing a previous downward trend, however, the Wuhan individual market is still slightly dropped. The market analysts believe that the macro data show that the economy has been warmer, the capital market is also strong, which boosted the confidence of the steel market. Steel plate prices with the potential to rise, but "high" shipments rose difficult. The weather is getting cold, the downstream steel enterprises procurement reduce the total demand is weak, or the more obvious. Also the consolidation of hot rolled coil prices stabilized, the dominant trend of the market has been divided, the Shanghai market is basically stable, Tianjin, Beijing and other manifestations of decline. Even up areas, the businessmen's willingness to raise steel prices are still relatively low. At a time when the year-end season, merchants repayment pressure greater surface tension of funds, large-scale "stockpile" phenomenon is unlikely to occur.

In the construction steel market, overall prices were slightly up. However, with the northern part of the region once again snowfall, the downstream demand is further suppressed, the turnover of the steel will be blocked. Think some steel trading business, taking into account the prices of raw materials such as iron ore, steel billets is still strong, the other specifications of the individual market segments less resources, and the bottom of the construction steel market there is still some support for limited downside, in short term, steel prices are still vulnerable fluctuations.

Relevant agencies said that some downstream industries of steel began to exhibit varying degrees of signs of warming, which is more or less conducive to the increase in demand for steel. But it must be remembered, steel prices have been more than a year of decline, businesses lingering fear, more cautious mentality, plus funds face superimposed adjustment factors, the China steel will continue to maintain a weak state.

About Chinese steel industry profits

According to the latest statistics released by the General Administration of Customs, Chinese iron ore imports in November to 65.78 million tons, an increase of 9.35 million tons last month, setting a new high for the year. The face of the dependence of imported iron ore up to 60% of the current situation, "going out" of Chinese steel is becoming increasingly important to develop overseas mining rights. Before the National Development and Reform Commission, the Foreign Investment Department, Deputy Director Wang Jianjun said publicly that will increase policy support and development of enterprises' overseas iron ore development efforts.

Analysts said, In recent years, China's iron and steel industry has entered a period of steady development, the decline in iron ore demand growth, coupled with the rapid growth of the domestic ore imported ore alternative, since 2009 China's ironore imports growth is slowing down, prompting our dependence on imported ore to 60%, but still did not get rid of the fact that this long-standing dependence on imported.

Analysis. The data show that three quarters of the iron and steel industry profits down 84.1%, a decline from the previous quarter expanded 46.8 percent.The response in the industry is mainly concentrated in three areas. First, adjust the structure of the iron ore imports to ease reliance on the traditional three miners. On the other hand, the steel industry from top to bottom all want to compete for iron ore pricing right, the beginning of this year, China launched the iron ore spot trading platform, the iron ore futures are also in the pipeline.

Therefore, in accordance with the current situation, in the last month of 2012, the import and export of all kinds of steel will basically remain stable, such as stainless steel, galvanized steel and galvalume steel production and sales will not be too large fluctuations.

The data show that imported ore, less than 10% of China's mining interests. Steel Association had raised the target, the supply capacity of iron ore concentrate production for 2015 will be the total demand of less than 40% to about 45%; imported overseas iron ore concentrate, China's mining interests in imports the proportion of the total amount will be increased to 50% or more.

So, overall, the development of China's iron and steel space is still very large, especially in overseas expansion, of course, the domestic policy factors also affect the profits of China's steel, and is a critical factor. Because China steel prices advantage in international competition no longer has a dominant position, so only the continuous improvement of technology to improve the technological content of the iron and steel industry and steel, in order to gain advantage in the fierce competition in the status.

Steel of opportunities and challenges in "Low-profit era"

After 10 consecutive years of rapid development, the operating profit is inevitable in the Chinese steel industry upgrade process and must bear. 21st century, 10 years, is a complete restructuring and development of China's steel industry, iron and steel power second leap.

Comprehensive analysis of the current domestic and international situation, China is facing unprecedented opportunities, but also the face of unprecedented challenges, China's development is still in an important period of strategic opportunities that can accomplish a great deal.

Looking to the future, both from the domestic and international macroeconomic trends, point of view or from the self-development of the steel industry, we need a broader perspective to look at the development of the iron and steel industry.

At present, the global economic environment has undergone great changes. The aftermath of the financial crisis of 2008 is not level, the European debt crisis was underway, the global economy will enter a long period of slow growth. China may face the situation of a fairly long period of slow growth in exports, which will bring the domestic export industries, including China steel and downstream industries have a significant impact. Of particular importance is that the financial crisis is changing the structure of global economic growth, the major developed countries have to revive the manufacturing industry and to expand export policy, China's manufacturing industry is facing the dual pressures of developed countries extrusion and emerging economies catch up, the domestic corporate restructuring and upgrading to more urgent demands. At the same time, however, has not yet completed the industrialization and urbanization will continue for the Chinese economy continued growth momentum is still evident, the international competitiveness of "Made in China", China is still in an important period of strategic opportunities.

In recent years, the "low-profit era" had become a hot word of the iron and steel industry. Iron and steel industry in peril declining, seems like a foregone conclusion. Since September last year, the domestic steel industry into the winter. To August this year, the domestic iron and steel enterprises, or operating profit fend for themselves, or in the gain or loss on the edge of survival.Steel industry after nearly 10 years of rapid development, the supply and demand relationship reversed, already one foot into the inflection point from the "demand" to "oversupply". On the one hand overcapacity intensifies, even the one hand, demand growth is slowing down. Therefore, China steel prices have no advantage in quality and technology, the next step should be up to improve and increase the technology content.

It is understood that, in the good news to stimulate the Anshan markets hot rolled coils prices overall rose in the range of 30-100 yuan / ton between turnover situation has improved, according to feedback Angang, Benxi Iron and Steel production 3.0 * 1250mm hot rolling open flatmainstream offer 3420-3450 yuan / ton, the various varieties and specifications are different rose.

Generally speaking, the transformation of China's iron and steel industry is a business model innovation, technological innovation is the iron and steel enterprises to achieve important support for the restructuring and development conditions. The Baosteel innovation as a foothold in enterprise restructuring and development, adhere to technological innovation as an important means for the implementation of the "the boutique strategic" and "environmental management. We want to speed up the construction of the innovation system, promote the new product development, engineering technology independent integration "and" live "three innovative system of continuous improvement. Future gathering resources research new technologies, develop new products and to optimize the protection mechanism of technological innovation, to create a better atmosphere and the mechanisms of corporate innovation.