The Price Of Spring Steel Has Plummeted

- Jan 02, 2019-

For iron and steel enterprises, especially construction steel enterprises, in recent years have been rare to encounter the traditional "Golden nine silver Ten" peak season, this year will eventually be repeated. "By September, it felt like demand had suddenly started, prices had come up, they had lost money before August, and they were now profitable.

"In the recent" 11th session of the 21st century China Building Entrepreneur Forum ", the manager of Tianjin private construction steel production enterprises, the market told the first financial daily reporter.

But the reporter consulted a number of downstream construction and equipment manufacturing enterprises found that compared with the three quarter and last year, downstream demand did not significantly improve, and with the arrival of the November off-season and ultra-low rebound brought about by the production of steel mills, the steel mill season is coming to an end. From March to August this year, the price of spring steel plate has been in a state of continuous decline, of which the July decline expanded, at the beginning of August prices fell to the lowest point of the year.

After that, since late August, steel prices have suddenly rebounded and continued into October, with a cumulative increase of 12% per cent. "The first eight months of steel mills almost all lost money, so a lot of maintenance or production cuts, steel traders are not willing to buy in advance to increase inventory pressure, so until September is suitable for the site to step up the rush season, the market steel supply is scarce, downstream emergency replenishment, but also to promote the rise in prices."

"The above management to this reporter analysis, in addition, he believes that the United States QE3 policy, as well as the national Development and Reform Commission has been approved a number of airports, rail transit construction projects, but also on the overall market mentality to improve the help." However, the above management also admitted that such a rise in steel prices can not be sustained, it is expected that there will be two waves of shock before the Spring Festival, because the price of the steel mills will be returned, such as his steel mill, has shifted from the start of the August two-thirds to full production, so that the overall inventory on the market will rise, and demand has not

Reports indicate that the national average daily crude steel production in September has increased by 2% from August, the average daily output in early October continued to rise by 4%, and further increases in late production will remain a large probability event.

The intensity of overall demand release in October has waned from September, with the next 11 and December falling into the traditional construction season, so demand expectations for next month will be gradually weakening.

In addition to facing the pressure of supply and demand, more and more inferior construction steel through various channels into the construction project.

According to the research of Sino-Chinese iron and Steel Logistics Professional Committee, at present, in the construction of various types of engineering projects, the quality of construction steel is widely taken to witness the sampling inspection system, and this system is flawed. "The spring plate supplier can take the qualified steel to the quality inspection mechanism to test, and then supply the site with inferior steel, from which profiteering."

"A steel mill source told the newspaper. "The industry urgently needs to standardize the construction unit of steel procurement, testing process.

Wang Jianzhong, secretary general of the Sino-United Steel Logistics Select committee, told the newspaper that at present, the Steel Logistics Standard project, jointly undertaken by the National Construction materials Supervision and inspection Center and the National Construction steel Quality Supervision and inspection center, is being advanced by the China Logistics and Purchasing Federation's steel Logistics Select committee.

The project includes steel product packaging marking, steel logistics operations, steel products spot electronic trading platform construction, steel products and Internet Information interaction technology and other aspects of the standardization of the development, in order to curb the steel circulation link existing opaque operation. According to the latest promulgated "Steel industry standard conditions", 2013 years later, it is strictly forbidden to produce first-class rebar, two-stage rebar. At present, two grade rebar accounted for about 60% of the market share, with the future increase in the entry threshold of the steel industry, some production facilities backward, production quality management is not strict enterprises, will face the situation of elimination.