China's steel exports exceed 100 million tons this year, a record
Release Time： 2022-08-18 11:24
Beijing time on December 10, FT reported that China's steel exports this year reached a record level of more than 100 million tons, indicating that China relies on global sales to help digest excess capacity.
Rising exports of China's processed raw materials, from steel to aluminum, have helped push commodity prices to their lowest levels in nearly a decade, weighing on shares of miners and steelmakers around the world.
A weaker yuan could even help China expand its exports further. Yesterday, China's central bank cut the central parity rate to its lowest level since 2011, sending the yuan to a four-year low.
Data show that in the first 11 months of 2015, China's steel exports increased by 22% to 101.7 million tons. Yesterday, China's Ministry of Finance said it would cut export tariffs on steel billets to 20 percent from 25 percent.
"Currently, China is cutting steel production very slowly, nowhere near what is needed to rebalance (domestic) or the global market," Capital Economics analyst John Kovacs said. John Kovács) said.
He went on to say that in euro terms, Chinese steel producers have been offering attractive prices this year.
Macquarie data shows that China's steel exports are 50% higher than total U.S. domestic steel production. The bank forecasts that China's annual steel exports will remain above 100 million tonnes until the end of the decade, during which time prices are unlikely to recover.
Macquarie said weaker steel prices had hit producers' profit margins, which had fallen to levels not seen since the early 1990s.
Steel demand is likely to fall by 1.7% this year, the WorldSteel Association said.
"The global steel industry is bankrupt," said Colin Hamilton, an analyst at Macquarie in London. “This shows that the industry restructuring process must be extremely painful. ”
China's steel exports have fueled trade tensions, but analysts say tariffs alone won't balance the market. Immediate action must be taken to address the challenge of overcapacity, industry and government officials at the Organisation for Economic Co-operation and Development's steel committee said after meeting this month. They expect that steel production capacity will continue to increase, reaching 2.4 billion tons in 2017.
The U.S. will announce the results of three anti-dumping investigations against hot-rolled steel coils, cold-rolled steel coils and coated products within three months.