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Upward or downward trend of Chinas steel market future divergence
【Time:2018-04-19 14:49】 【Traffic:
Although the price of China's steel market has declined all the way since March this year, even under the influence of Sino US trade friction, it is still accelerating downward. But for a relatively long term future, many industry insiders and market analysts have quite different opinions. Generally speaking, most of the industry trends are optimistic about the future trend of China's steel market, while analysts are relatively pessimistic.
 
 
The island of Hainan in the construction of free trade zone, into the arm of China's iron and steel market.
 
In the afternoon of April 13th, the Party Central Committee of China decided to support the construction of the free trade test area of the whole island of Hainan, and support Hainan to gradually explore and steadily promote the construction of free trade port with Chinese characteristics, and set up a free trade port policy and system in stages and stages. This blockage of China's iron and steel enterprises is not less than a dose of strong heart. The determination of the Hainan free trade test area will produce a great demand for infrastructure construction, resulting in a large amount of steel demand. And the recent decline in steel prices, the initial fuse is the imbalance between market supply and demand. The construction of Hainan free trade pilot area will greatly alleviate or even change this imbalance.
 
In addition, China's steel industry will continue to eliminate backward production capacity plans, and has greatly encouraged the confidence of the industry. In fact, China's steel industry this year's quarterly report has indeed provided support for this confidence. According to statistics, in the first quarter, China's iron and steel enterprises performance forecast will exceed expectations.
 
Since April, China's iron and steel industry blast furnace operating rate rose, crude steel output picked up slightly, while steel social inventories are continuing to fall. In addition, demand for downstream steel industry has risen, and demand for shipping and auto industry has risen. According to the insiders, the price of steel is expected to increase steadily as the market supply and demand continue to improve in April and the more stringent environmental protection policy is introduced.
 
Sino US trade friction is still the biggest uncertainty in the development of China's steel market.
 
Market analysts who hold the opposite view pay more attention to the adverse effects brought by Sino US trade friction. Although the share of China's steel exports to the US is very small, it accounts for only about 2% of the total steel imports in the United States, but the indirect export volume is not small. In 2017, for example, China exported only 1 million 180 thousand tons of steel to the United States, but China exported 2 million 700 thousand tons of steel in the form of electromechanical products to the United States.
 
Therefore, in order to achieve the greatest impact, will the United States take new measures against China's export to the US? In fact, in April 17th, the Secretary of Commerce of the United States, Ross, announced that the investigation of anti-dumping and countervailing investigations on the products of steel wheel hub produced in China had proved the possibility of existence.
 
What is more serious is the international influence of the United States. The United States claims to impose huge tariffs on countries that have exported steel products to the United States, while the main hit is mostly US allies and important neighbors, and Trump has to put out a "exemption list" and exempts his allies and neighbors. Will these "exempt countries" be consistent with the United States to a certain extent? Will the countries that are not on the exemption list take some sanctions against China in order to win the tariff exemption from the United States? These uncertainties have led analysts to be optimistic about the export situation of China's steel products and products.
 
What is more worrying is the capacity of China's steel industry. Although at the end of 3, China started a lot of investigation on the efficiency of the iron and steel industry, and reported the illegal construction of Shaanxi Province, and the situation of the displacement of illegal capacity in Hubei province. But this just proves the concerns of analysts: whether there is still illegal construction in the market, and whether the domestic steel production capacity policy has been effectively implemented.
 
Therefore, at present, the two party views somewhat depend on. To eliminate the differences, it is only a matter of fact.
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