A brief analysis of the internal and external difficulties in China's steel industry in 2012

Recently, the China Iron and Steel Industry Association 2012 meeting (expansion) meeting was held in Beijing. Zhu Jimin, president of China Iron and Steel Industry Association, delivered an important speech, pointing out that China's steel industry will still face a severe environment of “internal and external difficulties” this year, encouraging the hard work of the steel industry colleagues. Struggle and strive to explore new production and business models to break through the predicament. In his speech, President Zhu Jimin pointed out that the environment at home and abroad will still be very complicated and severe this year. The uncertainties and instability of the world economy have risen, and the momentum of world economic growth has obviously weakened. The European sovereign debt crisis is deteriorating and may have a new and major impact on the world economy. The global commodity market volatility has intensified, greatly increasing the uncertainty of the international iron ore trade trend. The further rise of trade and investment protectionism will seriously affect the steady growth of China's steel import and export trade. From the domestic situation, the problems of imbalance, uncoordinated and unsustainable economic development are still outstanding. There is downward pressure on domestic demand growth, which will affect the reasonable growth of investment, thereby further restricting steel consumption. The rising pressure on production costs is still large, and the operating risks are rising. The risk of small profits or losses for steel producers will further increase. In 2012, due to policy and market reasons, the growth rate of major steel industries such as domestic real estate and automobiles slowed down. Since last year, the growth rate of global steel market demand has declined, but steel production has grown too fast. The whole industry will still face a severe situation of serious imbalance between supply and demand, which further oppresses the market space of domestic steel companies and increases operational difficulties. Regarding the attitude towards difficulties, President Zhu Jimin made it clear that the Central Economic Work Conference held recently held a "stable and progress" and made clear that this year will continue to implement a proactive fiscal policy and a prudent monetary policy to keep the economy stable. Rapid development is an important goal, which creates favorable conditions for the steel industry to achieve steady development. This year is an important year for the implementation of the “Twelfth Five-Year Plan”. The steel industry is faced with the task of transforming the development mode and continuing to maintain a stable development. The national steel industry colleagues must be brave enough to meet the challenges and work hard to overcome the difficulties.

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