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Thursday, May 14, 2009

The first time in my three years of monthly snare trades of iron alloy

By Zou

The impact of imports of steel to be careful to deal with observation

This year, trades of iron alloy in the household market, development to a certain span, mostly intensified in the main heading of silicon iron alloy, hot-rolled iron alloy plates, etc. volumes and varieties. Due to the pointed down turn in iron alloy trade items and trades relation development in March this year, the Chinese billet into a snare trade of timber has been the position, this is the first time since three years.

Interviewed directly and iron alloy commerce professionals, who usually conceives that, whereas to referee from the present position, yet not constitute a long-term tendencies may be a stage, but should extend to observe this distinction, the careful response.

Import "all of a swift advance in" propelling down hard metal market

According to statistics of pertinent sections present that in February this year, China imported 1.09 million tons of hard metal, an advance in January than 220,000 tons; deals 310,000 tons hard metal billet, an advance of 18 million tons of hard metal deals from the ring than to undo the down movement purpose of scenery, to advance more than 25%; to March, 1.27 million tons of hard metal deals, exemplifying a expansion in February and 16.5%; 460,000 tons of deals of billet, and in March than increased. Month in March, the total lumber gaps have been changed to mesh deals, which is in 2006 our nation became a mesh exporter of hard metal after the first.

According to "My steel and steel" and other knowledge, for instance hard metal mills and Magang who saw that the hard metal deal "all of a swift advance in", chiefly condensed concurrently in the size of hot-rolled plates, billets, and other kinds oriented silicon steel. Volume of hot-rolled plates and billets in the first two months of this year have been a "net import"; oriented silicon hard metal at the end of February, early March and the end of March have distilled on the happening of the attainment of imports. Shanghai Steel Trade and Chamber of Commerce stakeholders to consider the prevailing quite low-cost foreign volumes of hot-rolled plates are still "down stream."

According to analysis, a number of international steel-producing countries of the exchange rate changes, the substantial depreciation of the currency relative to the dollar, may be a surge in imports of the driving forces. In addition, China's steel market demand, a sharp shrinkage of market demand in China is relatively good, the international community and the Chinese economy is expected to pick up, take advantage of the use of price competition in the Chinese market share, foreign steel has become an inevitable choice to find a way out.

According to reporters that the enquiry, the household sales of iron alloy goods has been sensed in varying qualifications the influence of imported products. This effect is not echoed in the allowance of primary, but in the general cost fluctuations. Magang Lee Marketing and Baosteel International sales are a reflection of capacity of trades of hot-plate and other goods in the amount can not state too much, but the household iron alloy charges will "pull down" some time before capacity tons of household thermal cost of more than 3,100 yuan, trade charges have been underneath 3,000. Oriented silicon iron alloy market is subject to the influence of low-cost imported goods, tons of worth early in January from 4 million dropped drastically from 2.2 million actually, the down turn is the biggest of all diversity of steel.

Do not have the "long-term trend," the conditions

Response to changes in steel imports, Baoshan Iron and Steel Institute of charge Wu Ying, China Metallurgical Industry Planning Research Institute, vice president of Lee and the newly created "My iron and steel," Jia liang qun information agencies and other experts believe that the increase in steel imports is likely to continue for some time. However, the current situation to determine, on the whole phenomenon is a stage, does not mean that China's steel import and export of inflection point.

According to the analysis of stakeholders, there is now a net monthly import, export of steel is only hampered by a relative performance. In February this year, China's steel export volume has been reduced to 39 months to the lowest point in March, although a slight pick-up chain, but still remain low. Relative to exports, as long as the increase in imports, on the vulnerable situation of net imports. However, the evolution of the market trend of global crude steel production in China in addition to nearly 40% of the rate of decline in the long-term maintenance is impossible, as the international short process of the restoration of production, will drive steel prices and global steel prices pick-up, which will gradually produce an environment conducive to exports of domestic steel price space. At the same time, the downward pressure on domestic steel prices will be "top" of the impact of steel imports to live, after all, the volume of imports of steel consumption in the domestic iron and steel plate in the total proportion of less than 3%.

Since the international economic urgent position, the household iron alloy commerce in a tough position. At present, a equitably very broad agreement that the commerce is: the adversities of the metal and iron alloy commerce the most direct cause is that the economic urgent position in a rapid contraction of demand as a outcome, the supply charges of excavation and the vertical down turn in iron alloy charges initiated by the decrease of a large area; to be the market a little warmer, the iron alloy unseeing rehabilitation and output, iron alloy charges extend to increase, producing in Steel City afresh, "bottom." And more deep reason: the structure of surplus capability and critical, in specific the reality of a large number of in turn around output capacity; developed engrossment is reduced, crude iron alloy output enterprises less than the mean dimensions of one million tons, grading the peak five iron alloy output enterprises of the nationwide total only about 28%; metal ore assets and the reduced grade of maritime security, proficiency to reply to alterations in the market; immature market scheme of iron alloy, metal and iron alloy goods more than 150,000 vendors, operators are inclined to more speculative; goods homogenization serious. The influence of trades of iron alloy market is a "plus or" factors.

Prudent to deal with divergent circumstances

News interview in the enquiry of associates of commerce accepts as factual that the structure of China's iron alloy trades, it is essential to differentiate between distinct positions, to make a distinct investigation in alignment to reply in a aimed at manner.

It is understood that in the Chinese steel imports to feed processing and processing of imported about 54 percent more than those of steel after the completion of processing of exports, domestic consumption did not in fact, is embodied in the demand for foreign markets; imports for domestic consumption accounting for about 45% of steel. Imports of plate steel, are mainly of domestic production can not produce or can not meet the needs but also of high value-added products, including the thickness of less than 1 mm cold-rolled sheet with the specifications, the thickness of 0.3 millimeters less than the standard cold-rolled thin & P strip and so on, the import dependency oriented silicon steel is as high as 51.4%. Products in the domestic steel industry has not yet been completed the upgrading of the structure, the import of high value-added products is inevitable; For the same fluctuations in the import of products, it reflects the interaction between domestic and foreign markets, the need to make an accurate assessment.

Experts trust that for the time being, obstructed the trade overseas of hard metal, getting higher inventories of in the household supplies, the consequence of hard metal deals "Three meet," will surely change in the competitiveness of in the household hard metal market circumstances, worthy of continued attention. Strong dependence on the deal of high value-added yield should be corrected in the implementation of highly-developed revitalization arranging efforts to enhance capability of unconnected research, endorse the high-end "import substitution" strategy; for quite low-end hard metal yield, but deals will help moderate in the household steel and hard metal development restructuring and lessening of steel ore are right away reliant on, do not have to anxiety too much about. - 18758

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