Chinese steel market and price trend analysis in 2008

Since 2008, a sudden rain and snow disaster has severely affected the production and people's lives in southern China, but also brought many variables to the Chinese steel market in 2008. The same is that the US economy, as the world's economic leader, has undergone a sudden change in just one month, which has made a small joke to the world and brought another change to our analysis of the steel market in 2008.

Especially since the 4th quarter of 2007, due to the rapid economic growth in Southeast Asia and the Middle East, the consumption of steel has heated up, coupled with the decline in the number of steel exports from China, there has been a certain degree of "steel tension" on the global scale of hot rolled coil prices in Western Europe. It also rose from 483 Euros per ton to 527 Euros.

In January 2008, the global crude steel output was 113 million tons, an increase of 4.9% year-on-year, and the output except China was 72.147 million tons, an increase of 4.7% year-on-year.

It is expected that the growth rate of my country's steel production will slow down significantly in 2008, and the annual crude steel output will be around 5.3-535 million tons.

In the first half of the year, domestic economic growth will remain strong. Especially after the rain and snow disaster, the central government has increased its support to the disaster-stricken areas and granted various preferential treatments in terms of land and credit. In addition, since the fourth quarter of 2007, the growth of domestic fixed asset investment has rebounded, which is reflected in the rebound of investment growth in newly-started projects. It is believed that the fixed asset investment in the first half of 2008 will remain quite strong. In the second half of the year, the domestic economy will be affected by macro-control measures and economic growth will slow down.

I believe that in the first half of the year, whether it is the domestic market or the international market, price increases will be the main theme. Regarding the trend of steel products throughout the year, what deserves more attention depends on the trend of the US and global economy and the intensity of domestic macro-control measures. If the US economy slows down in the second half of the year, it will affect global economic growth, coupled with domestic macro-control measures, in this case, steel prices will fluctuate.