“We estimate that China’s major traders and steel mills have accumulated 100 million tons of steel inventories,†Citigroup analyst Scarlett Chen said in an interview this month. Steel manufacturing companies are at the heart of China's manufacturing industry, while manufacturing is at the heart of the Chinese economy. The situation of a serious excess of steel production tells us that the Chinese economy will not recover this year. According to statistics released by the China Iron and Steel Association (CISA, China Steel Association), China’s steel inventories in mid-August increased by 26% compared with the same period last year. Therefore, the decline in crude steel production in China last month is not surprising. According to official statistics, China's crude steel output in August fell by 1.7% compared with the same period last year, and decreased by 4.8% compared with July. China Steel Association believes that this trend will continue to exist during the year. Xue Heping, a senior analyst at Steelinfo Consultancy in China, said in a report on the China Steel Association website that China's crude steel output may fall by 10% in the second half of this year. He wrote: "The significant decline in China's crude steel output in the second half of the year is a foregone conclusion." How will China's manufacturing industry move toward a stagnant crude steel production decline? He expects China's crude steel output this year to reach 678.7 million tons, down 0.7% from the record crude steel output of 618.3 million tons in 2011. In short, Xue Heping expects China's crude steel output this year to be the first decline in 31 years. China Steel Association is trying to exaggerate the current difficulties of Chinese steel mills, in the hope of getting more help from the Chinese government? In fact, the actual situation may be worse than what it describes. China Steel Association only investigates large steel companies, and large steel companies are currently in a better position than those of small and medium-sized steel companies. In addition, some people suspect that major steel mills are currently exaggerating their respective production data. “There are many motives for major steel mills to report on production performance,†said Tim Murray, co-founder of J Capital Research, in the Australian Financial Review. (Australian Financial Review) said in an interview. So, how bad is the current situation? According to Murray, China’s crude steel output in the first half of August this year may have fallen by 10%. He said: "There are some seasonal factors at work, but this decline in production is unusual." In any case, China Steel Association said that China's major steel companies are selling products at below cost. And there is room for further price declines. The downward trend in prices that lasted for four months seems to continue. China Steel Association also said that the profits of China's major steel companies in the first half of this year fell by an astonishing 95.8% compared with the same period in 2011. Stanley Li, an analyst at South Korea's Mirae Asset Securities, said in an interview with the South China Morning Post that most steel mills in China had a loss in August. As a result, major steel mills in China are currently cutting production, losing money and trying to cut inventory. So why is the Chinese government still allowing more steel mills to be built? At present, as many as one-quarter of China's steelmaking capacity is idle and many steel mills will not resume production after summer maintenance, the China Development and Reform Commission approved the construction of two steel mills with a total construction cost of 20.5 billion. Dollar. In May of this year, a photo of Wang Zhongbing, the mayor of Zhanjiang City, Guangdong Province, was widely circulated throughout China, and one of the projects was also famous. This famous photo shows that Wang Zhongbing kissed the approval document in front of the National Development and Reform Commission in Beijing. The NDRC, which is worried about overcapacity, had previously pressed Zhanjiang’s request to build a steel mill for more than a decade—the idea of ​​the steel mill was originally formed in the 1970s, and the Chinese government recently approved the project. However, if the proposed steel mill faces many difficulties in the future due to insufficient customers, Wang Zhongbing will not be so excited. Just as financial columnist Yu Fenghui accepted an interview with Taiwan’s Want China Times, “Mayor Wang Zhongbing kissed the approval document today, but the next mayor may cry for this approval document.†China The dilemma facing the steel industry is the result of disorderly expansion. It is no secret that China’s steel production accounts for almost half of the world’s total steel production, and the newly approved steel mill project will only make the situation Worse. Unless some steel mills are shut down soon, the downturn in profitability of Chinese steel producers will far exceed the two years expected by analysts. Suzanne Smith, head of rating agency's Asia-Pacific commodity rating division, said in a conference call earlier this month: "Global steel companies are currently experiencing adverse effects, but China's steel industry is facing the most dilemma Oops. Some blast furnaces in Europe have been closed, but we haven't seen this in China yet.†China has been plagued by overcapacity since 2005, but more steel mills are still being built. When Zhanjiang City first introduced the idea of ​​the project 34 years ago, it may make sense, but now the project is meaningless – except in the very short term. In the long run, the plight of this new proposed steel mill will spread to the entire city of Zhanjiang. As China Steel Association pointed out, the difficulties faced by major steel mills will affect suppliers. The dilemmas faced by suppliers will in turn lead to major banks, resulting in unemployment, a suppressed real estate market, and ultimately lower consumption levels in affected communities. China's steel industry - will it drag the other industries of the Chinese economy into a trough and become the biggest trouble for the Chinese economy?
Black Master Batch,Master Batch,Black Masterbatches
Pearlescent Masterbatch Co., Ltd. , http://www.nsmasterbatch.com