Decline in profit margin is difficult to eliminate steel production capacity in a strange circle
decline in profit margin is difficult to eliminate steel production capacity in a strange circle
China Construction machinery information
Guide: on the one hand, the sales profit margin of steel mills is declining year by year, on the other hand, the new steel production capacity is constantly expanding. Domestic steel enterprises, which have been in a state of low profits or even losses for a long time, are falling into a strange circle of greater and greater capacity elimination. From January to October this year, ferrous metal mining, smelting and rolling processing industrial steel
on the one hand, the sales profit margin of steel mills is declining year by year, on the other hand, the new steel production capacity is constantly expanding. Domestic steel enterprises, which have been in a state of low profits or even losses for a long time, are falling into a strange circle that the production capacity is becoming more and more obsolete
"from January to October this year, the fixed asset investment in ferrous metal mining, smelting and calendering steel industry was 3136.3 billion yuan, with a year-on-year increase of 18.9%, while the growth rate in the same period last year was only 1.6%, with a year-on-year increase of 17.3%, indicating that there is still capacity expansion in the steel industry." During the "my steel" annual meeting held yesterday, Zhang Changfu, vice president and Secretary General of China Iron and Steel Industry Association, pointed out the current strange circle of capacity expansion in the domestic steel industry with a set of data
expansion in areas with excess capacity
Zhang Changfu pointed out that according to the statistical data of China Steel Association, since this year, the investment in the steel industry has not only reappeared a significant growth trend, but also the investment hotspot is concentrated in the Bohai Rim region, where the steel production capacity has been seriously excess
from the investment of iron and steel projects in various regions, from January to October this year, the investment completed in Hebei, Liaoning, Shandong, Beijing and Tianjin around the Bohai Sea accounted for 27.2% of the investment in the whole industry; The investment in North China also accounted for 23.6% in the same period, nearly a quarter. The above-mentioned regions are the regions with serious overcapacity of iron and steel in China
on the other hand, the data shows that the profitability of the steel industry is not optimistic. According to the statistics of China Steel Association on key large and medium-sized iron and steel enterprises, from January to October this year, the average sales profit margin of steel was only 2.76%, lower than 2.91% in 2010, and the sales profit margin in October fell to 0.47%, a new low in the year, due to the rise of raw fuel prices higher than that of steel prices
the whole industry is on the verge of loss, why are there still enterprises expanding new production capacity
in this regard, an insider of an iron and steel enterprise located in the Bohai Rim region told that compared with some large state-owned iron and steel enterprises that produce more plates, the profit space of private iron and steel enterprises that mainly produce long products is relatively large. The production scale of these enterprises is often small, and only by expanding production lines can they further reduce costs and make more money. In addition, compared with some large steel enterprises trapped in the state's failure to approve new steel projects in principle, local small steel enterprises are more likely to privately acquire new projects. Since steel production is also the main source of local taxes, the local government is also "turning a blind eye" to this
another set of data disclosed by Zhang Changfu also confirmed that the new steel investment mainly comes from non-state-owned enterprises. From January to October this year, the investment projects of state-owned enterprises decreased by 0.38% year-on-year, while the investment volume of non-state-owned enterprises increased by 39.4% year-on-year. "It is worth our reflection that small and medium-sized enterprises use financing funds to expand in areas with overcapacity." Zhang Changfu said
eliminate the backward "small for big"
in fact, the above series of data is also the embarrassment faced by large state-owned enterprises such as Baosteel and WISCO. In recent years, these enterprises have not only faced many obstacles in the cross regional restructuring of domestic steel enterprises, but also failed to find the new projects that they hope to build. At present, the 10 million ton steel projects that Baosteel plans to build in Zhanjiang, Guangdong Province and Wuhan Iron and Steel Co., Ltd. plans to build in Fangchenggang, Guangxi province still need the approval of government departments
and such a strange circle has also been seen by the Ministry of industry and information technology. Zhangdechen, director of the iron and steel Department of the raw materials department of the Ministry of industry and information technology, said yesterday that the slow progress of domestic steel layout adjustment is one of the main problems faced by the steel industry, "For example, the Bohai Rim region has excess capacity, and a large amount of steel will be transported from the north to the south. Therefore, one of the goals of the 12th Five Year Plan is to curb the blind expansion of areas with excess capacity, build Zhanjiang and Fangchenggang steel boutiques, and have no less than one base on the construction floor, promote the construction of Fujian Ningde steel base, and fundamentally solve the problem of 'transporting north steel to the South'."
Zhang Dechen pointed out that in terms of optimizing the industrial layout, the Ministry of industry and information technology also hopes that different regions will no longer apply one size fits all. "In principle, the Bohai rim and Yangtze River Delta regions should no longer lay out new steel bases, while Hebei, Shandong, Jiangsu, Liaoning, Shanxi and other major steel provinces should reduce and adjust the industrial layout within the region. Hunan, Hubei, Henan, Anhui, Jiangxi and other central provinces should not increase the total amount of steel and promote industrial upgrading, while some western regions with relatively independent markets can appropriately develop the steel industry in combination with regional differentiation policies, such as Xinjiang and Yunnan And Heilongjiang and other border areas should actively explore and utilize the surrounding overseas minerals, energy and markets to develop the steel industry. "
another person in the iron and steel industry also told that another catalyst leading to the expansion of production capacity of small and medium-sized enterprises is the elimination of backward production capacity in recent years. Because the elimination of backward standards is linked to the volume of blast furnaces, after the elimination of some blast furnaces, the subsequent converters and mills will not have the supply of raw materials for the previous process, which is equivalent to the entire iron and steel making process will be affected, Therefore, many small and medium-sized iron and steel enterprises in order to survive in the new large blast furnace to avoid the total elimination of production capacity, which has caused the actual consequences of the more eliminated production capacity
it is understood that at present, after the national experiment on the iron and steel industry, the experimental curve can be called out again. The elimination of backward standards is indeed mainly based on the blast furnace volume. At first, it was stipulated that blast furnaces with less than 00 cubic meters of environmental impact factors and objects of the three identification projects should be eliminated, and then the standard was raised to 400 cubic meters
however, Zhang Dechen revealed yesterday that during the "12th Five Year Plan" period, we will continue to promote the elimination of backward iron and steel. It is planned to eliminate 45 million tons of backward iron making capacity and 50 million tons of steel making. However, for the elimination of backward standards, we will no longer use the standard of improving equipment capacity