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Behind the steel prices increase in China
Date:2016-04-07      View(s):1678      Tag:steel pirces increased, steel products prices increased in China

Recently, the Chinese major steel market price for rebar has inreased a lot. The average price increased from 2460 RMB/TON to 2616 RMB/TON. The increasing gap has reached 156 RMB/TON, and the increasing rate is around 6.34 %. This data has just set a new historical high record in the next six year. 

Accordingto the relevant statistcs showed, the construction steel prices increasing is very fast and strong and the inventory quantity in the market is quite limited. About the steel prices increasing, altough it have occured throughout the country, it has mainly focused in the North of China. Due to the mills production cut and futures rebound, the steel prices appeared booming. 
Futhur, due to the seasonal rainy weather occurs frequently, the amount of steel consumption is growing. With the maintained production capacity, the market demand is over market supply which is the root reason pulled the pirces up. Therefore, many steel companies have raised guidance prices, so it will be more difficult to reduce the price in a short time. 

Data from the relevant department statistics show that spot steel rebar in the first quarter rose 27.86%, hot rolled coil rose 19.8%, the steel futures market also rose 33.43 percent in the first quarter, HRC futures rose 46.7%, the basic profit per ton of steel maintained at between 200-400 yuan, compared with last year, really showing great progress. Steel plates prices have risen nearly 42% from last year to this year. For the steel enterprises, it is positive opportunities to recover from the steel depression from last year. 

Faced with the phenomenon of domestic steel prices rose, the national resources department in China also conducted an in-depth discoussion during the Seventh China Iron and Steel Planning Forum. During the discussion, the Secretary General Zhenjiang said, although the steel market in China is getting "warmer", price is the only factors has changed. Which means in the steel determination steel indicators has failed to occur improve. He believes, the only way to move forward in Chinese Steel Industry is to cut the production capacity, adjust steel industry structure, and increase efficienty.

"In order to actively respond to short-term overcapacity in steel, while ensuring that corporate earnings situation is stable, the price of steel is bound to become more and more stable together." As Sun Dongsheng said, "The current market price of steel will be some fluctuations, but not long-term steel production structure adjustment, the way of the future profits of the enterprise market stability have disruptive effects. To maintain their lucrative markets to adjust production capacity and demand for steel structure is necessary, short term rise in steel prices is not necessarily a a bad thing, but also to many steel companies saw new hope for the recovery of self. "

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