Steel demand fell slightly

Last year, the Chinese economy was affected by the demand contraction, supply shock and policy tightening. The growth momentum of consumption and investment weakened, and the steel demand of conduit pipe in housing construction and other fields showed an obvious stage decline. Under the background of weakening overall steel consumption momentum, the trend of steel demand this year is quite concerned by the market.

This year, China will continue to implement a proactive fiscal policy and prudent monetary policy, the momentum of sustained economic recovery will not change, moderately ahead of the development of infrastructure investment, to provide effective support for the overall stability of steel demand. By industry, the steel demand of machinery, automobile, shipbuilding, household appliances, railway, bicycle and motorcycle industries maintains the growth trend, but the steel demand of construction, energy, container, hardware products, rectangular steel pipe and wood furniture industries declines. It is predicted that the total steel demand of China will decline slightly this year.

Based on the analysis of steel consumption and net exports of steel and billet, China’s crude steel output of thinner wall steel pipe is expected to be 1.04 billion tons this year and 1.017 million tons next year, down 2.3% and 2.2% year-on-year, respectively. According to the crude steel production calculation, while taking into account the increase in the use of scrap and other factors, it is expected that the output of pig iron this year is about 863 million tons, down 2.8% year-on-year; Pig iron output is expected to be 824 million tons next year, down 4.5% from a year earlier.

Pig iron production directly affects the consumption and import of iron ore. Last year, China imported 1.13 billion tons of iron ore (62 percent grade), down 3.4 percent year on year. Iron ore imports in 2022 were 1.08 billion tons, down 4.4 percent year on year. Under the influence of a variety of factors, last year’s steel market volatility: before May 14, steel prices rose all the way, and the trend of long wood and plate is the same; In May, steel prices rose and began to fall gradually. The structural change is that the increase of long materials is less than that of sheet metal, which also reflects the demand of manufacturing industry is more vigorous than that of construction industry. Faced with new goals, new requirements for China steel tube manufacturers and new tasks, iron and steel enterprises should implement new development concepts and strive to build a new development pattern. We should continue to deepen supply-side structural reform, speed up structural adjustment, take reform and innovation as driving force, and pursue low-carbon and green development.