The Trend of Steel Industry in China's Economic Situation

After more than 6 years after the callback, the Chinese economy is now close to the bottom.Shinestar Steel Research Institute believes that the Chinese economic bottom is mainly high investment to the bottom of the high investment in the past few years mainly consists of three parts, accounting for 20-25% infrastructure, real estate accounted for 25-30%, manufacturing investment accounted for more than 30%, the three together can explain Chinese investment of around 85%, the remaining the 15% is the other services and agriculture etc.But investment in the manufacturing sector, and directly depends on the infrastructure, real estate and exports. High investment to touch the bottom is the three needs, infrastructure, real estate and exports, these three needs commonly known as the three boots to floor.

With the three needs to go down, steel, oil, petrochemical, building materials and so on these industries will have to go down, but because it is relatively slow, so there is a serious excess capacity.Serious excess capacity to bring the most direct change, is to see the two indicators.One is the factory prices of industrial products (PPI), more than and 50 months of negative growth, including iron and steel industry, the loss of a large area, the industrial enterprises profit growth rate from 2014 to August, more than a year of negative growth, but recently the situation has changed, in September, PPI has been from negative to positive, most industrial enterprises significantly improve the profitability of enterprises from negative to positive, in a rising trend.

At present, China's iron and steel industry to the production capacity has made some progress.The government has taken some measures,close down,there was also some supportive measures, also make adjustments in steel enterprises.Another is expected, we feel that after the production capacity, the role is also quite large.Capacity not less than 1.2 billion tons of iron and steel industry, but the output of 800 million tons last year, exports of 100 million tons, domestic is 700 million tons, so looking at the range of the excess in more than 30% at least, but the actual survey, it's not so.Do not know the steel industry in the end is how much effective production capacity, but the market has made a response to the price rise, the relationship between supply and demand has changed.So engage in market economy, more or to pay attention to effective production capacity, more attention to market signals.So for us to understand to what extent to the end, more in line with the actual.

Shinestar Steel Research Institute predicted, including but not limited to iron and steel, such as coal, petroleum and the price of commodities, the lowest price has been in the past.At present, Angle steel, galvanized Angle steel, channel steel, galvanized channel steel and other products prices are going.

Overall, China's economy will find a new equilibrium point after the end of China's economy, this new balance will be stable for 5-10 years or even longer.If the transformation of China's steel industry is relatively smooth, the future is expected to enter a quality, there are benefits, sustainable a good growth state.ChengShi of iron and steel group will actively transformation and upgrading, grasping the opportunities to develop themselves, produce higher quality of Angle steel, galvanized Angle steel, channel steel, galvanized channel steel and other products, meet the needs of more customers.