April 30, 2024

Crude steel production once again lower prices

Crude steel production once again goes down Yesterday, a number of steel mills including Sha Steel and Wuhan Iron & Steel raised their ex-factory prices. According to data released by the Bureau of Statistics last Friday, the national crude steel output in July was 65.47 million tons, which fell for three consecutive months and set a new low for crude steel production during the year.

The average daily output of crude steel fell in March and entered July. The domestic steel market reported the shortage of supplies from time to time. In some regions, there was a shortage of steel.

On August 9, the National Bureau of Statistics released data showing that in July, China produced 65.47 million tons of crude steel, with an average daily output of 2.12 million tons, which has been falling for three consecutive months since April.

It is noteworthy that compared with the data in May and June, the decline further increased in July, and its 2.12 million tons of data also set a new low for crude steel production during the year.

At the same time, the output of key steel enterprises entering the July is also gradually declining.

Among them, in the latter half of July, the key enterprises produced 1.673 million tons of crude steel per day, which fell by 2.16% month-on-month. The country's crude steel production by the end of the year was estimated at 2.984 million tons, reducing by 46,000 tons, falling by 2.67% from the previous period, and falling below 2.1 million tons again. turn off.

Wang Guoqing, director of Lange Iron and Steel Research Center, said that from January to June, the profits of the iron and steel industry fell month by month. In June, the industry turned from profit to loss. The continued low profit, coupled with the pressure of environmental protection and high temperature, made many steels. Discontinued maintenance of the plant directly led to a drop in July production.

Steel companies have raised their ex-factory prices in line with the decline in crude steel production. In contrast, the steel prices that had been falling for several months have gone through a wave of rising prices in July.

The data shows that as of yesterday, the comprehensive steel price index closed at 3,390 yuan/ton, and it has risen by 260 yuan/ton since July 1, an increase of 7.42%.

The continued warming of the spot market price also boosted the enthusiasm of the steel mills for price adjustment. Since July, many steel mills and steel traders have raised their prices.

Yesterday, a number of steel mills, including Shagang and Wuhan Iron and Steel, raised their ex-factory prices.

Among them, Shagang slightly raised the price of building materials in mid-August. The price of rebar has risen for 40%. The prices of high-line and coiled screws have risen flat. In Wuhan Iron & Steel, the ex-factory price of plates in September has been raised. Among the main varieties, hot-rolled and cold-rolled. The acid-wash steels have been adjusted upwards by 100 yuan/ton.

Wang Guoqing stated that the continuous decline in output and inventories has caused the supply of steel in the market to drop back. The severe situation of oversupply has been alleviated in stages and prices have continued to rise.

In the various macroeconomic data released by the Bureau of Statistics last July, the CPI for the month rose by 2.7% year-on-year, and the inflationary pressure was lower than expected. The industrial added value above designated size increased by 9.7% year-on-year, 0.8 percentage point higher than that of the previous month; in addition, the PPI increased year-on-year. Declined by 2.3%, the decrease narrowed by 0.4%, and signs of stabilization stabilized.

Wang Guoqing believes that the gradual stabilization of the macro economy and the steady growth policy that may be introduced in succession will lead to a mild recovery of the steel market in the second half of the year compared with the “winter season” of the entire industry. As the weather turns cold, the infrastructure construction will also accelerate. In the second half of the year, the shanty-husband reconstruction and railway infrastructure investment will increase the demand for steel. There is room for further rebound in steel prices in the future.

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