“In March, due to the impact of domestic steel price fluctuations, the profits and taxes and profit growth of the Hebei steel industry decreased by 36.18 and 31.39 percentage points respectively over the previous two months, and the main steel varieties reduced the benefit by about 1.8 billion yuan.†The first quarter of the industry information conference, the provincial metallurgical industry association secretary Wang Dayong introduced.
According to the data, due to the rapid release of production capacity in the previous two months and the high level of steel inventories, steel prices in the domestic market in March were generally lower than in February, of which 60% of the steel product prices fell by around 150 yuan/ton, the highest in hot rolling. The narrow strip fell by 327 yuan/ton. Among the top ten steel products monitored and controlled in Hebei Province, there were 6 varieties with a price drop of about RMB 150/ton in March. The output reached 12.1245 million tons, which accounted for 70% of the total steel output of the current month, affecting RMB 1.8 billion in the current month.
“This reflects the low-end, low-grade and low-efficiency problems of Hebei's iron and steel products, and the product structure is not reasonable.†Wang Dayong analyzed that the province’s crude steel production in the first quarter was 44.206 million tons, an increase of 11.49% year-on-year, continuing to First in the country. However, unlike the “big headâ€, there are very few high-tech and high-value-added products, such as automobile plates and home appliances, which are still dominated by construction steel products with low added value, and the product price is low. Among them, the hot rolled narrow strip steel with the largest reduction in price accounted for 18% of the province's steel production, and accounted for more than half of the same kind of products in the country, which affected the overall efficiency of steel in Hebei Province.
The problem of low-end, low-efficiency products is also reflected in exports. In the first quarter of this year, Hebei's iron and steel enterprises actively explored overseas markets. The province's steel exports totaled 1.81 million tons, an increase of 13.36% year-on-year; export value was 1.437 billion US dollars, a year-on-year increase of 42.62%. However, Hebei’s export steel prices averaged US$794.03/ton, which is US$200/ton lower than the national average selling price.
“To fundamentally change the development mode of Hebei's iron and steel industry, we must rely solely on scale-expanding development and shift to improving product performance, grades and quality as the main connotative development.†Wang Dayong said that the current steel industry has entered a low-profit era. In the face of intensified competition in product homogeneity, the steel industry in Hebei Province only has to accelerate the pace of structural adjustment, strive to increase the proportion of high-tech and high-value-added products, make it the first or only in the industry, and gradually increase the grade of steel grades, in order to continue Increase market competitiveness.