Thin plate profit keeps falling and the original balance of the market is broken

From the thin plate price fluctuations are hard to find, the capacity expansion is slowing down, the inventory does not increase, and the profits continue to fall. “You can see that the original balance of the market has been broken.” Wang Jianliang, Cold Rolling Editor of “My Steel Network” recently The "2013 (seventh) China Thin-plate Industry Chain Annual Meeting" was held at the meeting. In the past two years, the sheet metal industry has changed significantly compared with previous years. Compared with previous years, the law of sheet metal price fluctuations is hard to find. Wang Jianliang pointed out that from the price trend of sheet metal products in the past two years, the cycle of falling prices has been elongated. , and the rebound is limited. At the same time, he also stated that the price of cold-rolled coating products has obviously narrowed its amplitude.

Take the 1.0mm cold-rolled coil prices in the Shanghai market as an example, since 2008. The continuous amplitude has continued to narrow. From January to August this year, it was 520 yuan/ton, compared with 890 yuan/ton in 2012 and even 3,430 yuan/ton in 2008. At the same time, the cycle of obvious fluctuations has also narrowed. It was only 46 days in August and 68 days in 2012.

Although the amplitude of product prices has narrowed significantly, the market has fluctuate more frequently this year than in 2012. Wang Jianliang pointed out that compared to before 2009, the market has almost no bands to operate.

In addition, from the perspective of industry profits, the thin plate industry profits dropped again and again. According to Wang Jianliang, since the beginning of this year, hot rolling has been basically in a loss for 7 months, and cold-rolled and galvanized products have also suffered losses for 3-4 months.

Wang Jianliang believes that "the original balance of the market has been broken", and at the same time, the sheet metal market has also undergone some new changes.

It is reported that since the beginning of this year, the supply of cold-rolled products has remained at a high level. From January to July of this year, outside of the first two months, the supply of cold-rolled steel from March to July was basically over 5 million tons. However, according to data from the 23 city warehouses monitored by “My Steel”, this year’s cold rolled stocks did not increase. As of September 13, the cold rolled social inventory was 1.609 million tons, which was a decrease of 2.56 million tons from the same period of last year. .

Wang Jianliang said that despite the decline in social inventories, steel mill stocks have seen a certain increase. According to data from the China Iron and Steel Industry Association, stocks of steel mills at the end of the first ten days of September were 12.59 million tons, an increase of 4.4% year-on-year. He pointed out that "the stock of steel mills remains high, increasing the market's uncertainty."

At the same time, under the pressure of funds, steel mills will inevitably accelerate resource frontage and increase direct supply and export ratios. In recent years, major steel mills have been accelerating their internationalization strategy. According to media reports, in the first half of this year, Tangshan Iron & Steel has achieved a converse trend in steel export growth with a total of 1,425,600 tons of exported products, which is 29.12 million yuan more effective than domestic sales. Among the “2013 Top 500 Chinese Foreign Trade Enterprises”, Baoshan Iron and Steel Co., Ltd., Guangdong Shunde Steel Co., Ltd., and Songshan Iron & Steel Co., Ltd. were listed on the list, ranking 21st, 395th and 454th respectively.

Not only the production companies have undergone some changes in the imperceptibly, but also in the circulation and downstream industries. Under the control of bank credit, the role of reservoirs in circulation has dropped significantly; and the downstream industry has more considerations for suppliers' choices.

In the case of a series of changes in the sheet metal market, Wang Jianliang admitted frankly that if he only concentrates on his own field and ignores the research and exploration of customer experience, the company will eventually move to a dead end. “What we do is not just products. Competition, but changes in business models."