Z cold-formed steel will slow rebound in state

Silver four really extraordinary ah ! From the beginning of April, just entering , cold-formed steel z will slow rebound in the state , which makes steel trading business were slow breath , especially in recent days , simply can rebound in steel prices "crazy " to describe several days super 30 yuan / ton, the national average price of a rebound . The author believes that the rise in steel prices , in addition to the accumulation of bullish factors , but also by the psychological impact of the expected oversold bounce , but here I had to remind about the steel trading business , rising steel prices vigorous process , there are still downside risk go hand in hand , steel trading business to " stay in mind ."

Production capacity , steel industry capacity overall surplus. How to resolve such a huge excess capacity , backward and environmentally friendly energy is a priority to strengthen the Chinese steel industry in the future z faces. Ministry of Planning in China z Steel Forum said that last year the average asset-liability ratio z steel industry in China rose 70 percent , liabilities amounted to 1 trillion yuan . In addition to asset-liability ratio outside Baosteel steel prices 85% on average , and more short-term debt , cash flow is poor, creditors once the home is certainly a result of bankruptcy liquidation , so z steel industry for 20 years even in the face of the most serious oversupply , but the face of this love this scene , but did not dare to stop the blast of a business , even a loss or stocks surge , and no one will stop , also contributed to the elimination of backward production capacity results in poor reason .

For z steel companies, the recovery in global steel demand will continue to z , but because of the presence of uncertainty , z steel demand growth will remain relatively low , and therefore z steel enterprises will face a challenging situation. So the demand is not smooth, steel trading business have to beware .

Raw materials , especially iron ore resources in the upstream oligopoly status , Chinese steel enterprises z weak bargaining power . Since 2004 China steel industry z dependence on imported iron ore than 50 %, the highest for more than 60 % as the world 's largest iron ore demand for the country , China has little impact on the international iron ore price negotiations , it is industry-wide tragedy. Because the raw materials can not be dominant , which would mean the late steel trade is unknown whether they are profitable , at this stage of cold-formed steel rebound z is indeed cause for celebration , but do not be confused looks gorgeous , steel trade they must be prepared and our approach is the last word .

Profits , z steel industry is a capital-intensive industry , barriers to entry are not high but not low exit barriers so that all the characteristics of companies have entered into a prisoner's dilemma , they almost invariably take the same development strategy and business strategy, even if no serious loss willing to cut , not to mention discontinued. These factors determine the Chinese steel industry is not only z fierce competition and low profits, not long ago , China Steel Industry Association announced z operating efficiency of the national focus on the situation in 2013 and medium-sized steel enterprises z , its profit 22.886 billion yuan ( 2012 compared with a loss 1.27 billion yuan ) , although in 2013 the focus of the whole industry z steel companies to achieve profitability , but businesses still face a loss of up to 18.6% , the annual cumulative losses amounted to 11.825 billion yuan . As can be seen from here , at this stage z steel industry situation is still grim.

In summary, the steel trading business are faced with the crazy bounce of cold-formed steel z excitement and joy is understandable , but I think a good steel trade should put some of its far-reaching vision put , do not be short-term pick up the confusing , you should consider the overall number of problems . So as to be preserved in the cold in the Steel City .