The steel market is known as "gold, silver and four". However, the demand for steel at the beginning of this spring is less than expected——
According to the calculation of China Iron and Steel Industry Association, in the first quarter, the actual steel consumption in the main steel industry decreased by 5% year-on-year, including 7% in the construction industry and 2% in the manufacturing industry.
Behind the sluggish peak season is the weakening of both ends of supply and demand.
Qu Xiuli, vice president and Secretary General of China Iron and Steel Industry Association, said that from the demand side, China's vigorous promotion of infrastructure investment is conducive to stabilizing the demand expectation of the iron and steel industry. However, affected by the recent epidemic in China, the start-up of construction industry slowed down, the growth of manufacturing industry slowed down, and the demand for steel was restrained in the first quarter. In addition, the international environment has become more complex, and the import and export of steel has decreased year-on-year.
From the supply side, in the first quarter, affected by multiple factors such as staggered peak production in China's heating season and closure and control of the epidemic, iron and steel enterprises reduced production and stopped production more; Enterprises in production are also faced with difficulties such as raw materials entering the factory, production organization, contract implementation, sharp rise in production costs and so on. In the first quarter, the national output of steel was 4.35 billion tons, a year-on-year decrease of 1.05%.
In terms of price, China's steel prices rose in the first quarter, with export prices rising faster than imports. At present, the prices of iron ore, coking coal and other raw and fuel materials for steel production continue to fluctuate at a high level, which still supports the price. However, under the guidance of the national policy of ensuring supply and stabilizing price and the dynamic matching of supply and demand, the price is generally stable. The decline of profit margin also restricts the production willingness of enterprises.
However, insiders pointed out that in the short term, the supply and demand of the steel market are weak, but the later market demand will accelerate the release.
He Wenbo, executive president of China Iron and Steel Industry Association, believes that steel consumption has not been substantially started in the first quarter. In the later stage, under the national goal of stable growth, with the mitigation of the epidemic situation and the force of multiple policies, the demand for steel will be released faster, and the demand growth is expected to be greater than the output growth.
This year's government work report proposes to start a number of qualified major projects, new infrastructure, transformation of old public facilities and other construction projects; Moderately advance infrastructure investment; Promote the virtuous circle and healthy development of the real estate industry by implementing policies for the city; Continue to support the consumption of new energy vehicles, and encourage local governments to carry out green smart appliances to the countryside and trade in the old for the new; Start to transform a number of old urban communities... These will effectively stimulate the demand for steel.
"The steel consumption suppressed in the early stage will not disappear, but will be delayed." Shi Hongwei, deputy secretary of China Iron and Steel Industry Association, said.
Steel demand potential is still, forcing the supply side to improve quality and efficiency and adapt to the new changes in supply and demand structure.
The reporter learned that even though Baoshan base in Shanghai is under closed production, as of mid April, Baoshan Iron & Steel Co.Ltd(600019) company's strategic product, non oriented silicon steel widely used in all kinds of motors, doubled its sales year-on-year. Up to now, the rolling volume of heavy sector products has achieved 114.84% of the predetermined target in April. The seamless steel pipe heat treatment line set the highest monthly production record in nine years in March.
The total profit, net profit and iron concentrate output of Angang Group in the first quarter all hit the best level in the same period in history. Anshan Iron and Steel Company under Anshan Iron and Steel Group, the sales of hot rolling tool and die steel and railway vehicle steel reached a new high in recent years in the first quarter. The sales of u77mncrh, a unique heavy rail product of Anshan Iron and Steel Group, increased by 40% compared with the whole year of 2021.
The construction of the joint venture project of Hegang group and POSCO automobile board of Korea Co., Ltd. is steadily advancing in Tangshan. When completed and put into operation, it will become one of the largest suppliers of high-end automobile panels in China, taking into account high-grade high-strength steel and household appliance boards.
Chen Kelong, director of the raw material industry department of the Ministry of industry and information technology, said publicly recently that in the short term, the iron and steel industry will be more affected by the two-way pressure of supply constraints and demand contraction. The problem of weak supply and demand is difficult to change in the short term. The development characteristics of reduction are more obvious, and began to enter the stage of medium, low-speed and high-quality development.
Recently, the national development and Reform Commission and other departments have conducted research and deployment on the reduction of crude steel output this year to ensure the year-on-year decline of national crude steel output this year, guide iron and steel enterprises to abandon the extensive development mode of winning by quantity and promote the high-quality development of the iron and steel industry.
"The profit margin of some special steel enterprises is higher than the average level of the whole industry." Qu Xiuli said that the overall demand for steel is expected to be stable throughout the year, but from the perspective of demand structure, high-value-added varieties such as automobile sectors and electrical steel closely related to new energy vehicles, UHV and wind power generation will usher in better development opportunities.
