Steel prices as a whole "stumble endlessly" production to accelerate the export decline due to oversupply
Iron and steel prices have experienced short-term gains, and then began to continue lower. As of April 11, Hebei Tangshan billet prices around 2900 yuan per ton, compared to March 19, the level of 3300 yuan per ton, a decline of more than 10%. The emergence of the above situation, and enterprises to speed up production, but steel exports fell significantly, the overall oversupply related. April 11, Hebei Tangshan blast furnace operating rate of 90% or more, reflecting the local steel production is still fast.
Domestic steel prices as a whole showed a downward trend.
In the country announced the first half of this year to remove all the steel, and to increase efforts to produce capacity, the steel prices experienced a short-term rise, and then began to decline.
As of April 11, Hebei Tangshan billet prices around 2900 yuan per ton, compared to March 19, the level of 3300 yuan per ton, a decline of more than 10%.
Billet prices are not the largest decline in steel varieties. According to the 21st century economic report reporter learned that in about three weeks time, hot rolled, iron ore prices fell even reached about 20%.
This year with the same period last year, steel prices skyrocketing show two days of the scene. In late April 2016, billet prices in the 2,500 yuan per ton, compared with the beginning of February at a low of 1,500 yuan per ton, or about 70%.
21st century economic report reporter was informed that the emergence of the above situation, and enterprises to speed up production, but steel exports fell significantly, the overall oversupply related. April 11, Hebei Tangshan blast furnace operating rate of 90% or more, reflecting the local steel production is still fast.
Data show that from January to February this year, China's steel production was 2.823 million tons, an increase of 4.1%, but exports of steel compared with the same period last year fell 25.7%.
Steel prices fell more than 10%
According to the 2017 government work report, this year to reduce steel production capacity of about 50 million tons, 45 million tons last year, the target increase of 5 million tons. In addition, this year by the end of June to remove all the steel, so the actual task of all the production capacity than 2016 even larger.
But the capacity to bring the steel price surge seems no longer continued. April 21, 2016, Hebei Tangshan and the national steel prices reached the highest in more than 1 year, but this year since late March, steel prices have continued to decline.
For example, to April 11, in addition to Hebei Tangshan billet prices than on March 19 fell more than 10%, the three rebar prices than the March 17 price fell more than 10%. As for the hot roll and PB powder (an iron ore), the price on April 11 were 3180 yuan per ton, 565 yuan, respectively, than the February 28 high of 3830 yuan per ton, and February 22 high Point 715 yuan per ton, down nearly 20%.
According to the end of June to remove the conservative estimate of tens of millions of tons of steel, which in the case of high probability will make the market steel shortage, the corresponding rise in prices, but now it is not the case.
Lange Economic Research Center, chief analyst Chen Kexin that such a contradiction and the actual steel to the progress of production capacity. There may be multiple reasons, such as futures prices in the early 2016 since the strong rise, and now to callback, the other market for the first half of the progress of the ban on the progress of steel, or doubts.
"Because the actual progress of a great deal of uncertainty, if the full realization of the production capacity, steel prices will certainly rise." Chen Kexin said.
In addition, according to the 21st century economic report reporter learned that the current steel prices continued to fall, may also be related to real estate regulation. For example, the recent national more than 40 cities have increased the real estate regulation, and real estate steel accounted for the proportion of all steel in the two into four into about.
Metallurgical Industry Economic Development Research Center expert Liu Haimin that real estate regulation and control indeed have an impact on steel prices, but still not a substantial decline, there may be other factors. Such as the rapid decline in the price of hot rolled coil, the plate itself is not affected by real estate, but the automotive industry slowed down, reducing its demand.
Enterprises to speed up production lead to excess
Why is steel prices going down? Fundamentally speaking, the product is still oversupply.
For example, crude steel production in January-February was 120 million tons, an increase of 5.8%, while the national crude steel production in 2016 was 808 million tons, up only 1.2% year on year. This means that this year the company to accelerate production to increase production trend is obvious.
But in fact the market is not so much consumption. January-February steel exports fell by 25.7%, if this situation continues, will make a substantial decline in demand for crude steel.
Senior steel expert Ma Zhongpu that is clearly the current price decline is caused by reduced demand for steel. At present, industrial investment growth is very low, the demand for steel is low. The demand for steel is mainly based on the national railway, roads, bridges and other infrastructure investment as the representative.
National Bureau of Statistics data show that from January to February the national industrial investment 1430.2 billion yuan, an increase of 3.8%, is still low. But the same period infrastructure investment grew 27.3%, the growth rate over last year increased by 9.9 percentage points.
The steel inventory should not be overlooked. Data show that as of March 24, the country's 45 major ports imported iron ore stocks climbed to 1325 million tons, the highest level since the record.
Lange steel cloud business platform monitoring data show that as of March 24, the country's 29 major cities in construction steel social stock reached 801.57 million tons, up 21.67% over the same period last year.
My steel network researcher Wei Zengmin that last year, the rise in steel prices is not driven by demand, but because of the supply side of the structural reform to reduce production capacity. From the perspective of China's market environment, if GDP growth remained normal, then the demand for steel should be down.
He pointed out that only in the GDP growth rate of 6.8% or 7% or even higher, the demand for steel will be explosive growth, it is expected that the next phase of the overall price of steel or at a relatively low level.
Steel prices this year there are many factors of the game situation, there may be a substantial fluctuations. "The most important factor is to the real progress of production capacity, in particular, all to ban the determination of the steel." Chen Kexin said.