The website of the National Development and Reform Commission released the first quarter of the four major industries of iron and steel, non-ferrous metals, building materials, and chemical industry, showing that the growth rate of the four major industries slowed down compared with the same period of last year, in which the growth rate of cement production in the building materials industry slowed down by 10.8 percent year-on-year. The growth rate of ferroalloy production in steel slowed down by 11 percentage points year-on-year, which was a product category that experienced a year-on-year increase in the four major industries.
Chen Wei, a macroeconomic analyst of national securities, told the Daily Economic News reporter that the slowdown in the growth of these industries was related to the overall economic environment. “The above industries have experienced serious overcapacity in the future. In time, this situation will continue to occur. It is expected that the growth rate will still fall in the second quarter and even the second half of the year, but the situation may be slightly better than the first quarter."
According to the data released on the website of the National Development and Reform Commission, in the first quarter of this year, China's crude steel output was 174.22 million tons, an increase of 2.5% year-on-year, a year-on-year slowdown of 6.2 percentage points; steel output was 222.46 million tons, an increase of 6.5%, slowing by 7.2 percentage points. In addition, coke and ferroalloys have different signs of slowing growth.
Anhai Xuan, a researcher in the metallurgical industry of China Investment Advisors, stated that China's steel market is greatly affected by fluctuations in raw material prices. The current overcapacity in the steel industry in China, coupled with the declining demand in the off-season entering the steel market, will inevitably lead to a slump in the steel market.
Chen Wei also believes that not only the steel industry, many industries have excess capacity, "mainly the impact of the previous 4 trillion investment plan, the next method can only be to reduce production capacity."
Although the growth of steel production slowed down significantly in the first quarter, the price of steel in our country rose slightly. In March, the average price index of steel prices in the domestic market was 120.33, a rise of 1.25 points from the previous month and a decrease of 11.29 points from the same period of last year.
However, An Haixuan believes that due to China's strict control measures on real estate, making the downstream market demand decreased, coupled with the high cost of steel prices, the steel market will still take some time to pick up.
In addition to the steel industry, the non-ferrous metals, building materials, and chemical industries are also facing similar conditions. In the first quarter, the output of ten kinds of nonferrous metals nationwide was 8.4 million tons, an increase of 5.8% year-on-year, and the growth rate slowed down by 3.5 percentage points year-on-year. In addition to electrolytic aluminum, the price of major non-ferrous metals rose slightly.
In the building materials industry, the country’s cement output was 3,981 million tons, an increase of 7.3% year-on-year, a year-on-year slowdown of 10.8 percentage points; flat glass production was 179.83 million weight cases, an increase of 4.3%, slowing by 6.5 percentage points. Although the growth rate slowed down at the same time, the price of flat glass rebounded and cement prices fell.
The added value of the chemical industry increased by 13.5% year-on-year, representing an increase of 1.8 percentage points year-on-year. Among the key monitored chemical products, the prices of urea, yellow phosphorus, and imported potassium chloride rose from the previous month, and prices of other products fell slightly.
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