At present, the domestic steel market in China is experiencing the traditional off-season of demand. However, the government’s strong commitment to infrastructure investment through increased financial power is expected to provide some support. Despite improvements in project funds availability, the start and construction of domestic infrastructure projects might experience a rushed start followed by a slowdown due to seasonal weather factors. On the other hand, the housing construction market is still undergoing an adjustment period. Although there are signs of marginal improvement in indicators such as real estate development investment and commercial housing sales, the short-term impact on new construction remains limited. Furthermore, the demand for manufacturing steel is expected to gradually slow down due to insufficient demand release and limited improvement in benefits. These factors, combined with enhanced policy expectations, disturbances from leveling control policy, demand fluctuations, and increased cost support, are likely to weaken the willingness of domestic steel production enterprises to release production capacity. As a result, it is anticipated that domestic steel production will continue its downward trend in November. The national crude steel production is projected to remain at about 2.5 million tons per day, with key large and medium-sized steel companies contributing to a daily crude steel output of approximately 2 million tons.
The domestic steel market in China is now entering the traditional off-season of demand, resulting in challenges for steel industry players. However, there is optimism as the government is making determined efforts to provide a financial boost for infrastructure investment. This is expected to lead to improvements in project funds availability. Nevertheless, the current situation is still influenced by seasonal weather factors, which might cause a rush to start and construct infrastructure projects, followed by a slowdown. This could have a significant impact on the steel market.
In addition to the challenges faced by the infrastructure sector, the housing construction market is also going through a transition period. While there are some signs of progress, such as marginal improvements in real estate development investment and commercial housing sales, the short-term effect on new construction remains limited. The adjustment period is causing uncertainties in the housing construction market, which in turn affects the steel market.
Furthermore, the demand for manufacturing steel is gradually slowing down due to insufficient demand release and limited improvement in benefits. This situation is likely to persist and contribute to the weakening willingness of domestic steel production enterprises to release production capacity. Factors like enhanced policy expectations and disturbances from leveling control policy are also impacting the production capacity of domestic steel industries. Additionally, increased cost support is adding to the challenges faced by the steel market.
Given these circumstances, it is expected that domestic steel production will continue its downward trend in November. The national crude steel production is anticipated to remain at around 2.5 million tons per day. Key large and medium-sized steel companies are projected to contribute to a daily crude steel output of approximately 2 million tons. The challenges faced by the steel market are complex and require careful attention and strategic planning from industry stakeholders.
Post time: Nov-16-2023