Analysis on demand and trend forecast of China's steel industry in 2016

In 2015, the core of iron and steel supply and demand driven factors is the decline in demand, on the one hand domestic demand growth continued negative growth, exports, on the other hand, although it has maintained a rapid growth, but the total is difficult to reverse the domestic demand decline, in the first three quarters of crude steel production in the same period last year fell 2.1%.

Year-on-year growth rate this year, 1-10 months of real estate sales area recovery to 7.2%, and the new construction area up 13.9% decline, the decline in new construction further affect the construction area of growth in the downlink, and continued to decline in real estate investment growth drag, this year 1-10 months of real estate investment growth is only 2%, down 10 percentage points.

China's iron and steel exports in 2014~2015. China's steel exports since 2014 continued to maintain rapid growth, the domestic steel prices fell sharply for indirectly causing the competitiveness of China's steel prices significantly increase is an important reason, this advantage in 2015 continu es to expand. 1~10 months of this year China's total exports of 92 million 130 thousand tons of steel, an increase of 25%.

No. 41 bibliographic, China has stopped new crude steel production capacity of the project examination and approval, with the original project in 2013-14 basically completed and put into production, later the new production projects will continue to decrease. But forced in the policy and market in the process of clearing capacity will accelerate in 2016. We predict that in 2016 the industry shut down capacity or reach 40 million tons, compared to 2015, the number of shutting down capacity doubled.

According to already published by the Ministry of industry and trade in accordance with the standard conditions for the steel industry the third batch of companies list, and the General Logistics Department showed that as of 2014, I between the Kuomintang and the Communist Party of China has 11.48 million tons of crude steel production capacity, the converter steelmaking capacity of 1.026 billion tons, electric furnace steelmaking capacity of 123 million tons.

No. 41 in accordance with the planning, 2013~17 year plan eliminated capacity target of 80 million tons, the first two years by policies to promote have been completed out of 37 million tons, but to "zombie" capacity based (that has been long discontinued production line); and from 2015 onwards, with the decline in demand caused by the deterioration of the relationship between supply and demand, a substantial increase in the trade deficit, more and more high cost steel mills will be eliminated from the market. click here 

The trend of steel prices on the one hand by the impact of their own supply and demand, on the other hand also by the cost of support. Due to the current widespread heavy losses in the steel industry, steel prices have fallen to near the cash cost, so the trend of steel prices will be mainly affected by the impact of iron ore and coking coal prices.

From the Chinese industrial information network

Xinpengyuan Steel Pipe
Fenghuang Industry Garden, Liaocheng City, Shandong Province,China
Tel: 0086-635-5100828   5100909   5100829
Xinpeng Group
Hunan Road, Liaocheng City,Shandong Province, China
Tel: 0086-635-5100828   5100909    5100829
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