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The decline in the steel industry is not encouraging

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The decline in the steel industry is not encouraging

January 11
17:28 2021

This year’s output of hot dipped galvanized rectangular steel tube can break through 1 billion tons? This question should be asked of downstream steel users. Market demand is the fundamental factor that determines steel output. Expert analyzed that, influenced by the downward pressure on the economy, the trade situation and other factors, the government introduced a series of strong regulatory policies, adding vitality to the national economic development.In the past two years, China’s highway, railway and other infrastructure construction projects concentrated and real estate investment has maintained steady growth, so that steel demand can maintain growth. But the steel industry has started a new downward cycle, which is irresistible.Crude steel production this year is likely to reach about 970 million tons, not more than 1 billion tons.

In the first half of the year, the profit of the steel industry dropped by about 20%, and it will continue to drop in the second half of the year. A 30% drop in the profit of the whole year is a very likely event. He thinks the steel industry’s benefits will fall sharply year on year and not be optimistic. For analysis of the reasons for the decline in benefits, he believes that there are mainly four aspects: first, the main raw material iron ore is almost monopolized by four foreign mining enterprises,domestic steel pipe suppliers do not have a voice; Second, the regional steel market has been excessive, such as shanxi, shanxi, sichuan and gansu have taken the initiative to reduce production measures; Third, some products like mild steel tube appear structural surplus momentum; Fourth, steel production costs to the downstream industry transmission blocked.

Regarding the merger and reorganization of the steel industry, zhao xizi said that the crude steel output of private steel enterprises accounts for more than 60% of China’s steel enterprises.It is more difficult for private steel companies to restructure than state-owned ones. Private steel enterprises have also made great progress in technology, a number of technology reached the domestic and even international leading level. While developing at high speed and high quality, private steel enterprises should also attach importance to the construction of enterprise culture, ensure the welfare of employees and assume social responsibilities.Only by sharing the fruits of development with employees and making contributions to the local economy can we build a century-old store. Steel enterprises and hollow section manufacturers have basically reached the special emission limit and a considerable number of them have reached the ultra-low emission standard.

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