In September to October, the demand for steel will rebound to a certain extent, which is bullish for the steel market.
On September 3, the China Iron and Steel Industry Association organized a self-discipline meeting for the steel industry in the Guangdong and Guangxi regions to analyze the supply and demand situation of the steel market in these regions, assess the future market trends, explore collaborative mechanisms between long and short process enterprises, and maintain the stable and orderly development of the regional market.
The meeting was attended by leaders of 14 steel enterprises in the Guangdong and Guangxi regions, including Baowu Zhongnan Steel & Iron, Liugang, Shenglong Metallurgy, Yangchun Xingang, Zhuhai Yueyufeng, Guangdong Jingye, Guangdong Jinshenglan, Guangdong Guixin Steel & Iron, Guangxi Guixin Steel & Iron, Heyuan Derun, Yuehua Steel, Hongde Steel, Yongda Steel, and Guigang Steel, as well as leaders of the Guangdong Iron and Steel Association and Shanghai Ganglian E-commerce Holdings.
The attending companies unanimously believe that the demand for steel in the market has significantly decreased this year, prices have sharply fallen, and the extent of loss has continued to expand. The situation is particularly prominent in the Guangdong and Guangxi regions, where steel prices, which used to be the 'high ground' in the national market, have once fallen to a 'low point', and even the phenomenon of shipping steel from the south to the north has emerged.
The convening of this meeting is urgent and timely. Faced with a severe market situation, steel companies in the Guangdong and Guangxi regions must have a unified understanding, unified thinking, and unified action. They should release capacity reasonably, promote supply and demand balance, maintain a stable and orderly market order, and promote the healthy development of the Guangdong and Guangxi markets.
Representatives at the meeting believe that in September to October, the demand for steel will rebound to a certain extent, which is bullish for the steel market. However, caution should be exercised to avoid excessive production and temporary supply-demand imbalances, as a positive turn of events could also be short-lived.
At the same time, it is recommended that relevant departments strengthen their supervision of the capital markets to prevent speculation and excessive fluctuations in the steel market.
In the first half of the year, the overall performance of listed companies in the steel industry was poor. Among the 47 listed companies in the steel industry that have disclosed their semi-annual reports for 2024, 32 companies achieved profits, but only 13 companies saw a year-on-year increase in net income.
The latest data released by the China Iron and Steel Association (CISA) shows that the prices of mainstream rebar steel have fallen by nearly 20% compared to the same period last year. Institutions believe that the market demand for the steel industry in the future is expected to stabilize, driven by the resilience of downstream industries such as manufacturing, which will boost the demand for steel.
Taking into account factors such as the release of infrastructure demand, the resilience of the manufacturing industry and export demand, the total steel demand for the whole year is expected to maintain growth, and steel company profits are expected to be restored.
Related companies in the steel sector: Angang Steel (00347), Chongqing Iron and Steel (01053), Maanshan Iron and Steel (00323), China Oriental (00581).
Maanshan Iron and Steel Co., Ltd. (00323), Chongqing Iron and Steel Co., Ltd. (01053), China Oriental Group Co., Ltd. (00581), Angang Steel Co., Ltd. (00347).