Qi says hard times for steel to continue
December 8, 2008
For the buyers importing steel from China or having domestic demand to Chinese suppliers must keep on suppliers. Here is the latest news from Chinese supliers:
CHINA’S steel industry has entered a hard time after seven years of rapid expansion, and a turnaround is unlikely until the second quarter of next year, according to Qi Xiangdong, deputy secretary with China Iron and Steel Association.
Slackening demand at home and overseas has hit the country’s 71 major steel makers, said Qi.
Their profit totaled 126.8 billion yuan (US$18.5 billion) during the January-October period, down 0.93 percent from a year earlier.
Forty-two large or medium-sized steel companies posted losses in October. The combined losses reached 7.8 billion yuan.
The proactive fiscal policy and moderately loose monetary policy as well as the central government’s efforts to boost domestic demand and fixed asset investments would all have a positive impact on the development of the steel manufacturing industry in 2009, Qi said.
Last month, China unveiled an estimated 4-trillion-yuan stimulus package as part of its bid to offset adverse global economic conditions by boosting domestic demand.
The money is to be spent over the next two years to finance programs including low-income housing, rural infrastructure, water, electricity, transportation, the environment, technological innovation and rebuilding from several disasters, most notably the May 12 earthquake.
Although the elimination of export duties on 67 types of steel from December 1 would help cut the cost of exports, Qi expected steel exports to slump next year due to dwindling global demand.
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Energy: Steel mills to cut production on slump demands
October 8, 2008
Several leading Chinese steel mills are set to cut production to cope with the pressure of weak demand hanging over their iron-smelting furnaces.
Shougang Group and three other big domestic iron and steel manufacturers will slash 20 percent of their production this month amid slack domestic demand and dropping steel prices, according to Monday’s China Securities Journal.
These major steel makers included Hebei Iron and Steel Group, Shandong Iron and Steel Group and Anyang Iron and Steel Group.
Hu Kai, a senior industry analyst with the Umetal.com website, told Xinhua on Monday the sagging price was the main cause of the production reduction.
“There is no signal that the steel product price would be ratcheted up in the near future, as some steel product prices remain high compared to previous years, construction-use steel products in particular.”
China’s real estate sector was currently in its nadir, which also pulled down steel product consumption, he added.
Steel prices on the domestic market dropped 5 percent in the week preceding the weeklong National Day holiday that started September 29, according to the newspaper citing Xu Xiangchun, a mysteel.com analyst.
These steel mills would endeavor to further reduce the purchasing price of raw materials, adjust product mix and enhance communication among the companies respective management, according to the Beijing-based newspaper.
Hu said to some extent these companies had overreacted to the sluggish market as the output cutback exceeded the actual market demand decline.
Beijing-based Shougang Group declined to comment on the news report when reached by Xinhua. Its shares shed 5.31 percent to 3.39 yuan (50 cents) per share on Monday trading.
Source: China Daily
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Chinese Steel Makers is Cutting Output
September 4, 2008
CHINESE steel makers are cutting output because of weaker demand and higher raw-material costs
Production was reduced by 10 percent from August, Yang Siming, general manager of the Jiangsu-based company, said at a steel conference in Xiamen yesterday.
“A lot of steel makers were making losses from August,” Yang said. “Small mills were forced to close, with bigger ones reducing output.”
Contract iron ore prices have gained as much as 97 percent and coking coal more than doubled for Chinese mills.
Nanjing Steel buys two-thirds of the iron ore it needs through long-term contracts, Yang said.
China’s prices of hot-rolled coil, a benchmark product, fell 13 percent to 5,163 yuan (US$755) a ton yesterday from 5,957 yuan on June 5.
Xinyu Iron and Steel Co, a Jiangsu Province-based steel maker, is bringing forward annual maintenance of its plants because of slowing demand, Chairman Xiong Xiaoxing said at the conference.
Nanjing Steel United plans to build a mill in Lianyungang port, Jiangsu Province, Yang said.
Nanjing needs to close 2 million tons of obsolete capacity and buy other rivals to help win government approval, he said.
Xinyu Steel is building a 3-million-ton-a-year plant.
Source:Xinhua
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Iron ore handling charges rise by 11pct
August 30, 2008
RIZHAO Port Co, China’s biggest iron ore port, said it will raise handling charges by 11 percent for the steel making mineral, as stockpiles remain high.
From September 1, the handling fee will be raised to 30.50 yuan (US$4.46) a ton from 27.50 yuan, for imported iron ore at its port, the Shandong Province-based company told the Shanghai Stock Exchange yesterday.
China’s iron ore imports rose 22 percent in the first seven months to 269.6 million tons, according to customs figures. [Read more]
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China may raise manganese export tax
April 9, 2007
China may increase the export tax on electrolytic manganese and manganese alloy in a move to counter rising exports, an industry analyst told Interfax.
Industry rumours suggest that China may raise the electrolytic manganese export tax from 15% to 28 or 30% this month, while the export tax on manganese alloy may increase from 10% to 15%.
The price difference between electrolytic manganese and manganese alloy in domestic and overseas markets encourages exports under the current export tax rates, Antaike analyst surnamed Gao said.
The current manganese FOB price is $2,800 per tonne, while the domestic electrolytic manganese price lies between RMB 17,000 ($2,200) and RMB 18,000 ($2,329) per tonne. Under the current 15% export tax, the domestic price is approximately $113 to $270 per tonne less than the overseas price.
“China is likely to further increase the current the export tax rate on manganese and manganese alloy if there is a further increase in exports,” Gao said. He declined to comment further on the rumors.
China exported 33,900 tonnes of electrolytic manganese in January and February, down 19.15% from the previous year. High carbon ferromanganese (>2%) exports increased 106% to 24,967 tonnes and silicon manganese exports increased to 87,100 tonnes, up 55.9% during the same period, according to Beijing Antaike Information Co. Ltd.
Gao attributed the recent slump in electrolytic manganese exports to the Spring Festival and predicts that China’s electrolytic manganese and manganese alloy exports will bounce back in March.
China imposed the current 10% manganese alloy export tax on Jan. 1, 2007, down from a previous 20%.
On August 1 2005, the Chinese government cancelled the 13% export tax rebate on unrolled manganese and scrap manganese of tax code of 81110010 starting.
Manganese is essential to iron and steel production. Steel making, including its iron making component, has accounted for most manganese demand, presently in the range of 85% to 90% of the total demand.
Among a variety of other uses, manganese is a key component of low-cost stainless steel formulations and certain widely used aluminium alloys.
Source: Interfax
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