Abstract In 2014, the world economy was deeply adjusted and China's economic growth slowed down. In the face of downward pressure on the economy, the government did not take strong incentives, but vigorously promoted reforms to stimulate the vitality of the market and enterprises. The annual GDP growth was 7.4%, a slight decline from the same period of last year.
In 2014, the world economy was deeply adjusted and China’s economic growth slowed down. In the face of downward pressure on the economy, the government did not take strong incentives, but vigorously promoted reforms to stimulate the vitality of the market and enterprises. The annual GDP growth was 7.4%, a slight decline from the same period of last year. More than 13 million new jobs were created in cities and towns. In the case of slowing economic growth, the structural reforms have taken new steps and the economic restructuring has achieved remarkable results. The quality and efficiency of economic development have improved significantly. However, the economic growth has continued to decline in steel demand intensity, steel consumption growth is weak, while crude steel output still maintains a small increase. The contradiction between market supply and demand is still outstanding, and steel prices have hit new lows. Thanks to the large drop in the price of raw fuel and the internal tapping and cost reduction, the overall profitability of the whole industry has improved, but the profit level is still very low. I. Overall operation of the steel industry in 2014
1. Domestic crude steel output increased slightly, and the growth rate dropped sharply.
In 2014, the country produced a total of 823 million tons of crude steel, 712 million tons of pig iron and 1.126 billion tons of steel, up 0.89%, 0.47% and 4.46% respectively over the same period of the previous year. The growth rate dropped by 6.65 percentage points, 5.77 percentage points and 6.89 percentage point. China's crude steel production accounts for 50.26% of world steel production. In 2014, the output of crude steel of member companies was 658 million tons, up 1.65% year-on-year, higher than the national growth rate; other enterprises produced 165 million tons of crude steel, down 2.03% year-on-year.
2. Steel exports have grown substantially, with cumulative exports exceeding imports.
In 2014, the country exported 93.78 million tons of steel, a substantial increase of 50.5% year-on-year; imported steel 14.43 million tons, up 2.5% year-on-year, maintaining a small increase; equivalent to net crude steel exports of about 84.41 million tons, an increase of about 33.08 million tons, the same period of the country Steel production increased by approximately 7.34 million tons year-on-year. Since 1949, China has imported 594 million tons of steel and exported 596 million tons of steel. By the end of 2014, China’s cumulative exports of steel exceeded imports.
3. Social inventories continue to be low, and corporate inventories are still higher than the beginning of the year.
In December 2014, the social stocks of five major steel products in 22 cities were 8.2 million tons, down 140,000 tons from the previous month, and kept falling for nine consecutive months, the lowest level in the past four years. In December, the inventory of major regions in the country was declining, and the inventory of the five major varieties was declining except for cold rolled coils and wires. In January of this year, the social stocks of five major steel products in 22 cities were 8.68 million tons, an increase of 480,000 tons from the previous month. After the first nine months of decline, the first increase was still far below the level of the same period in the past four years. The effect is significantly weakened. According to the statistics of the Iron and Steel Association, the inventory of key steel enterprises at the end of December was 12.89 million tons, which was 480,000 tons higher than the beginning of the year.
4. Iron ore supply exceeds demand, prices continue to fall
In 2014, China imported 933 million tons of iron ore, up 13.8% year-on-year, of which 86.85 million tons of iron ore were imported in December, an increase of 19.45 million tons, an increase of 28.9%. China's iron ore external dependence has further increased to 78.5%, an increase of 9.7 percentage points year-on-year. In 2014, the domestic iron ore raw ore output was 1.51 billion tons, an increase of 56.86 million tons, an increase of 3.9%. Among them, the domestic iron ore output in December was 126 million tons, down 4.6% year-on-year, and the chain fell for three consecutive months. After the peak of iron ore port stocks peaked in May, it showed a slight decline for seven consecutive months. At the end of December, the port inventory was 98.24 million tons, an increase of about 11 million tons from the beginning of the year. In 2015, the port inventory fluctuated around 98 million tons.
In 2014, iron ore prices continued to decline overall. The average import price for the year was US$100.42/ton, down US$29.2/ton from the same period last year. The average price of iron ore imports in December was US$75.61/ton, down by US$4.05/ton from the previous month.
5. The fixed assets investment in the iron and steel industry has further declined, and the proportion of private investment has increased.
In 2014, the iron and steel industry (including the ferrous metal mining and dressing industry, the iron and steel industry, the steel industry, the steel processing industry, after deducting the foundry industry and the ferroalloy industry) completed a fixed asset investment of 525.12 billion yuan, a year-on-year decrease of 5.42%, compared with the same period last year. For an increase of 0.91%. Among them, the fixed assets investment in the iron and steel industry fell sharply by 31.76% year-on-year, the steel industry fell 10.39% year-on-year, and the steel processing industry fell 4.98% year-on-year. Only the investment in the ferrous metal mining industry continued to grow, up only 1.45% year-on-year. Under the influence of the sharp drop in ore prices, the growth rate of mine investment has further declined.
The proportion of private investment has increased. In 2014, the ferrous metal smelting and rolling processing industry completed an investment of 4,789 yuan, a year-on-year decrease of 5.9%; among them, private investment accounted for 79.59%, an increase of 3.02 percentage points year-on-year. The investment in ferrous metal mining and dressing industry was 169.016 billion yuan, a year-on-year increase of 2.6%; among them, private investment accounted for 88.99%, up 4.48 percentage points year-on-year.
6. The steel price index continued to fall, hitting new lows
At the end of December, the CSPI steel comprehensive price index of the Iron and Steel Association was 83.09 points, down 2.20 points month on month, a decrease of 2.58%; a year-on-year decrease of 16.05 points, a decrease of 16.19%. Since 2015, the steel price index has continued to decline slightly. The steel composite price index fell to 80.3 points in the second week of January, and continued to hit a new low. Judging from the average price trend in 2014, the average price drop of the eight major steel products is about 10%, of which the rebar has a maximum reduction of 12.9% and the galvanized sheet has a minimum of 6.78%.
7. The profit has improved and the profit level is still very low.
In 2014, large and medium-sized steel enterprises achieved sales revenue of 358.207 billion yuan, down 2.98% year-on-year; realized profits and taxes of 109.092 billion yuan, up 12.15% year-on-year; realized profits of 30.444 billion yuan, an increase of 8.754 billion yuan, an increase of 40.36%. The accumulated loss was 14.77%, down 4.55 percentage points year-on-year; the loss was 11.747 billion yuan, down 8.02% year-on-year; the sales profit rate was 0.85%, up 0.26 percentage points year-on-year. From the perspective of the composition of profits, the main business remains profitable, but the profit level is very low.
Second, the situation facing the steel industry in 2015
At present, the world economy is still in a period of deep adjustment after the international financial crisis. The world economic growth rate may rebound slightly this year, but the overall recovery is difficult to change significantly. The international financial market is fluctuating, commodity prices are fluctuating, and geography The influence of non-economic factors such as politics has increased. The domestic economy has remained generally stable, but downward pressure has increased. As the demand of the downstream industry slows down, the market competition will become more intense. The production and operation of iron and steel enterprises will face new challenges; the fluctuation of the price of the main raw fuel will bring uncertainty to the production and operation of the enterprise and increase the operational risks of the enterprise; Difficulties in financing and financing are difficult to alleviate, and the risks of exchange rates and debts may also increase. In short, we must maintain a clear understanding of the complexity and seriousness of the situation facing the whole industry this year.
In the face of the new normal, iron and steel enterprises should fully understand and adapt to the situation, accelerate the pace of change, shift from a large-scale development focusing on expanding production capacity to a high-quality development focusing on quality improvement of varieties, shifting from a growth mode focusing on output efficiency to focusing on comprehensive efficiency improvement. The growth model shifts from focusing on improving product competitiveness to focusing on comprehensive competitiveness reform, optimization and upgrading, from focusing on hard power building to paying more attention to the improvement of soft power, from focusing on domestic development to starting to plan for international development. And continue to explore new modes of cooperation between enterprises and industries. To serve the development of the enterprise and the transformation and upgrading of the industry.
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