China Steel Association: In the late stage of steel industry, steel prices will remain low

The market entered the off-season of steel consumption, and the demand for the steel industry was weak. It is expected that steel prices will remain low and fluctuate.

First Financial News: The China Iron and Steel Association released its monthly analysis report on December 15. In November, affected by the continued fall in fixed asset investment and manufacturing growth, the domestic market demand was weak and steel prices continued to decline; Decreased, the steel price decline in the month has narrowed. In the late period, the market entered the off-season of steel consumption, and the steel industry was not in demand. It is expected that steel prices will remain low and fluctuate.

China Steel Association further pointed out that due to the decline in demand and the impact of cold weather, the demand for steel in the domestic market showed a downward trend. At the same time, due to the impact of sovereign debt crisis, the international market demand has shrunk. The world’s major economies have strengthened trade protectionism and increased anti-dumping and anti-subsidy measures against China; *** against the US dollar as a whole, steel companies’ steel exports will also face greater Difficulties. It is suggested that iron and steel enterprises should pay close attention to the market, actively adjust product structure, strengthen internal potential exploration, and increase market competitiveness.

The report also pointed out that due to the weakening of the steel market demand, the iron and steel enterprises have been increasing their production insuring prices since the second half of the year; along with the continuous decline in the domestic supply of crude steel, the supply and demand in the market will be eased. Previously, according to the statistics of the China Iron and Steel Association, in the end of November, the average daily output of crude steel of its key member companies was 1.5226 million tons, which was only an increase of 1.25% compared with the previous month; the national crude steel output was estimated to be 1.6852 million tons in late November, which was a month-on-month increase. 1.29%.

On the other hand, the national monetary policy is fine-tuned and it is expected that the tightening of liquidity in the market will be eased in the later period. The government emphasizes the combination of credit policy and industrial policy, protection and pressure to ensure that the state focuses on the funding needs of projects under construction and continued construction, and focuses on supporting affordable housing**, small and micro enterprises**, and foreign trade companies**, and increasing the use of ordinary commercial housing. To speed up the construction of affordable housing, monetary policy has a tendency of “directional loosening” in structure.

The report also showed that in November, the growth rate of the steel industry further slowed down, coupled with the continued decline in the price of raw materials, the support factors for steel prices further weakened, and steel prices continued to decline. As of the end of November, the CSPI steel comprehensive price index of China Iron and Steel Association was 122.33 points, a decrease of 0.32% from the previous month and a decrease of 2.35% from the same period last year. The index fell to the lowest point this year and was lower than the same period of 2010 for the first time.

During the same period, the CSPI longevity index was 128.82 points, a month-on-month increase of 0.81%, a year-on-year decrease of 1.75%, and the sheet metal index was 117.81 points, a decrease of 1.14% month-on-month and a decrease of 2.23% year-on-year.

From the price changes of the eight steel products monitored by the China Iron and Steel Association, the prices of high-grade and rebar in long products have risen from low to high, with increases of 3.45% and 2.77% respectively. The price of angle iron continued to decline, with a decrease of 2.38%; the prices of sheet and tube materials continued to decline, of which the price of coils was relatively stable with a month-on-month decrease of only 0.07%. The prices of plate, cold-rolled sheet, galvanized sheet and hot rolled seamless tube decreased by 2.07%, 0.89%, 3.75%, and 2.22%.

On the other hand, it is currently in the off-season of steel consumption, and social inventories have continued to decline, which has reduced the pressure on market resources. At the end of November, the five steel social stocks in the 26 major steel markets across the country totaled 13.14 million tons, a drop of 8.38% from the previous quarter. Large stocks of long products have declined sharply, and both rebar and wire stocks have reached the lowest levels since the beginning of this year, which were 4.92 million tons and 910,000 tons, respectively, a decrease of 13.06% and 18.57% compared with the previous quarter; the decline in sheet stocks was smaller than that of long products, and hot-rolled coils Inventory fell to 4.35 million tons, a month-on-month decrease of 4.78%; cold-rolled sheet stocks fell to 1.51 million tons, a decrease of 1.16%; plate stocks 1.44 million tons, a decrease of 1.23%.