In the first half of this year, China's steel industry fell into a loss-making situation in the whole industry. As steel prices have fallen, some steel mills have begun to cut production. Despite this, the de-stocking pressure faced by the steel industry is still relatively large. According to data from the China Iron and Steel Association, at the end of July, steel inventories fell by 1.07% from the previous month, but still increased by 19.22% compared with the beginning of the year, and the destocking rate of steel has slowed down. At the same time, with the continuous reduction of imported iron ore prices, how to digest nearly 10,000 tons of port iron ore stocks is still a problem facing the industry. The destocking rate of steel has slowed down since it reached a high point in February this year. China's steel social inventories have remained above the level of 15 million tons. Since March, stocks have started to decline, but by July the inventory rate has begun to slow down. According to the latest data from China Iron and Steel Association, as of the end of July, the social stocks of five types of steel (middle plate, cold rolled sheet, hot rolled sheet, wire and rebar) in 26 major steel markets nationwide were 15.38 million tons, down from the end of last month. 170,000 tons, a decrease of 1.07%, the third consecutive month, the decline narrowed. In terms of varieties, stocks of wire rod, rebar and cold rolled sheet continued to decline, down by 2.38%, 1.37% and 1.04% respectively; medium stocks fell from up to 2.18%; hot rolled coil stocks were The increase was 0.49%. It is worth noting that although after nearly five months of continuous decline, compared with the beginning of the year, steel inventories still increased by 2.48 million tons, an increase of 19.22%; compared with the same period last year, the inventory increased by 1.53 million tons, an increase It is 11.02%. It can be seen that since the beginning of this year, China's steel social stocks have remained at a level of more than 15 million tons. Among them, at the end of February, it reached a high of 18.94 million tons. Compared with the high steel inventory, steel prices have been falling. At the end of July, the price declines of the eight major steel products monitored by the China Iron and Steel Association increased from June, with high-line, rebar, plate and hot-rolled coils falling sharply, down 7.47% and 8.25 respectively. %, 7.83% and 8.30%; the price of angle steel decreased by 3.52%; the prices of cold rolled sheet and galvanized sheet decreased by 5.40% and 3.11% respectively; the price of hot rolled seamless tube decreased by 1.86%. After entering August, steel prices continued to decline. By the second week of August, steel prices had fallen for the 16th consecutive week. Affected by this, the performance of listed steel companies is worrying. According to Wind data, the net profit of the eight steel companies that disclosed the report in the first half of the year totaled 542 million yuan, a year-on-year decrease of 70.78%. As of the end of June, the total inventory of these companies reached 27.504 billion yuan, an increase of 5.79%. The provision for inventory depreciation was RMB 218 million, a year-on-year increase of 35.21%. Port ore is difficult to digest This year, China's port iron ore stocks have been 徘徊 10,000 tons. Due to the difficulty of profitability, low inventory turnover has become the way of operation for many steel mills. Coupled with the continuous decline in iron ore prices, how to digest high-priced port iron ore stocks has become a problem facing the industry. Statistics show that from August 7 to 13, China's port iron ore inventory (25 ports along the coast) was 98.59 million tons, a decrease of 170,000 tons from the end of the previous reporting period. The latest China iron ore price index was 416.17 points, down 5.95% from the previous month. Since the beginning of this year, the price of imported iron ore has fallen step by step. At the beginning of the year, the price of imported iron ore was about US$145.51/ton, and it broke the $150 mark in May. However, iron ore prices have continued to fall since then. According to the China Iron and Steel Association, the average price of imported iron ore fell to 121.61 US dollars / ton in the second week of August, down by 12.11 US dollars / ton from the end of July, a decrease of 9.06%, which is the lowest level since October last year. China Steel Association expects that with the lower steel prices, there will be further room for further decline in iron ore prices. At present, China's major steel mills have begun to cut production, and the demand for iron ore and procurement enthusiasm have also been greatly reduced. The industry expects that with the shutdown of the steel mills, the spot price of the port will gradually decline, the ore trading volume will still shrink rapidly, and most traders will remain cautious and wait-and-see attitude. The iron ore port inventory digest still needs a long process.
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