The profit of the hottest steel will achieve 6% gr

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Iron and steel profits will achieve 6% growth

Guide: the external environment continues to improve. First of all, from the international environment, the global economy has a warming trend, and the international steel market is expected to be in shortage. WSD predicts that the international steel demand in 2004 is expected to increase by more than 6% to 940 million tons. On the supply side, due to the downturn of the steel market in the past few years, Europe, the United States, Japan and so on

the external environment continues to improve

first of all, from the perspective of the international environment, the global economy has a warming trend, and the international steel market is expected to be in shortage. WSD predicts that the international steel demand in 2004 is expected to increase by more than 6% to 940 million tons. On the supply side, affected by the downturn of the steel market in the past few years, major steel producing countries such as Europe, the United States and Japan, through continuous capacity reduction, mergers and acquisitions, have made the steel production speed decline significantly, or even negative growth. These factors are conducive to changing the oversupply of the international steel market. WSD predicts that there will be a shortage in the international steel market in 2004 with the growth of demand in the world's major consumer countries

secondly, from the perspective of domestic environment, the domestic economy, culture and military continue to grow steadily, and the high growth trend of steel demand remains unchanged. First, the macro-economic growth. The growth of GDP has an obvious pull on steel, which is the fundamental factor for the rapid development of China's steel industry in recent years. Second, the pulling effect of fixed asset investment on steel demand is still obvious. We believe that the fixed asset investment will not decline significantly in 2004, and can still be maintained at more than 20%. Compared with the trend of the previous three years, the 20% growth rate of fixed asset investment is enough to support the% growth of the steel industry. Third, the demand for steel in the downstream high growth industries is still very obvious. The steel consumption of 8 major industries including construction, automobile and shipbuilding accounts for 80% of the total consumption. We believe that the current investment in real estate development is generally healthy and has strong sustainability. Although the momentum has slowed down, the overall trend remains the same. At the same time, the downstream industries such as automobile, machinery, household appliances, shipbuilding, electric power and so on continue to be optimistic. The demand for steel is growing steadily. Finally, the impact of changes in the steel foreign trade environment on China is limited. Although the United States canceled Article 201 in early December, and China also canceled trade safeguard measures, we believe that it has little impact on domestic supply and demand as a whole. First, at present, the most important factor in the domestic market is demand. If demand remains strong, the pattern of supply and demand will not change significantly. China's demand not only affects domestic demand, but also becomes one of the key factors affecting international supply and demand. Second, the role of the current safeguard measures is becoming smaller and smaller. In 2003, the steel import rate exceeded 40%. It should be said that the role of quota restrictions is generally small, and most of the quotas have been consumed by November, indicating that the industry is still running well without quota guarantee during this period. Third, the Ministry of Commerce issued an announcement on january13,2004, deciding that from january14,2004, operators importing cold-rolled coils originating in Russia, South Korea, Ukraine, Kazakhstan and other four countries and Taiwan should pay corresponding anti-dumping duties, which is good for domestic steel enterprises

there will still be a slight shortage of supply in 2004

although demand continues to grow, the supply side is limited by many factors, and it is expected that there will be a shortage of supply. On the one hand, it is the supporting capacity and construction cycle. The construction period of plate production line is generally 2 years, and that of wire rod and screw thread steel is about 1 year, excluding the influence of previous processes such as ironmaking and steelmaking. If all the supporting problems of supply and demand are considered at the same time, we believe that it will take at least two years from the construction of new capacity to the final production capacity. Therefore, a large amount of investment in the metallurgical industry this year is expected to play a role in about 2006, with little impact on the recent steel market

on the other hand, it is the bottleneck of raw materials. As China is a country lacking in iron ore, with the rapid growth of China's steel production, the contradiction of iron ore shortage will be higher and higher. In 2003, nearly 50% of China's iron ore needs to be imported (nearly 150million tons). In 2004, at least 50million tons of iron ore needs to be imported. Considering the capacity constraints of mines, shipping and wharfs, the shortage of raw materials in the next year has been determined, which has become the biggest constraint on the domestic steel production. In addition to ore, coke, scrap and other factors will also indirectly affect the growth of output

the operating indicators of major industries will continue to improve

production and consumption. It is estimated that the absolute growth of steel production in 2004 will be about 30million tons, with a growth rate of 13%; The steel consumption will exceed 290million tons, with a year-on-year increase of 14%. In terms of steel prices, considering the support of rising raw material prices and the high operation of international steel prices, we believe that steel prices will remain high in 2004, and the annual average price is expected to exceed 2003

. In terms of industry profits, although the annual average price in 2004 is expected to exceed that in 2003, considering the rising cost caused by the rising price of raw materials, the profits of the whole industry will increase by about 6%, while those companies with capacity growth and resource advantages are expected to maintain rapid profit growth

Baosteel Co., Ltd. (600019): a leading enterprise in the iron industry and a truly internationally competitive listed company. It has advantages in product, technology and cost, and benefits the most from the shortage of domestic thin plates. If the collection is too fast or too slow, the test results will be different. 1. The sample group company has joint-venture mines in Australia and Brazil, which can ensure the raw material supply of the joint-stock company. The wide and heavy plate project under construction and the cooperation with Nippon Steel to build 1800 cold rolling mill will enhance the development strength of the company. Angang New rolling (000898): it has certain scale and technical advantages. At the same time, the group has the largest mine in China. When there is a shortage of domestic resources, its advantages stand out. The second cold rolling and joint venture galvanizing lines put into operation in 2003 are the future profit growth points. The product varieties span construction and sheet steel, with strong risk resistance. It is expected that the company's profits will increase by a certain margin in 2003 and 2004. TISCO stainless (000825): the largest stainless steel full process manufacturer in China, with unique advantages. Nearly 80% of domestic stainless steel needs to be imported, so the company has great room for development in the future. In the future, it is planned to build a scale of 2million tons, which can rank among the third stainless steel in the world and be stronger than small cars. In 2003 and 2004, the company will benefit from capacity growth and price rise, and its profits are expected to continue to grow. Authors: huangmeilong, fenghaihua, sunzhanjun, Su Jing

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