In a recent survey conducted by the China Internet of Things Steel Logistics Professional Committee, it has been revealed that the export order index of the country’s steel industry has continued to shrink. This is largely attributed to the lack of prosperity in overseas manufacturing, leading to weakened external demand and a slow recovery in overseas supply. In November 2023, the new export order index of steel companies was recorded at 44.3%, marking a 1.4 percentage point decrease from the previous month. Similarly, the new export order index of steel circulation companies stood at 49.1%, indicating a 1.1 percentage point increase from the previous month but still operating within the contraction zone. With the export order index of steel companies continuing to shrink, there are concerns that this will further restrict the country’s steel exports in the future.
Despite the challenges associated with the shrinking export orders, there has been a slight month-on-month increase in China’s steel exports in November. However, when compared to the previous year, the growth remains substantial. The current status of the country’s steel export price advantage has been slightly enhanced. This is in contrast to the overseas steel market supply, which has continued to rebound, leading to increased pressure on external demand. With the global manufacturing index rebounding within the contraction range, it is evident that the export order index of China’s steel companies has been falling within the same range, further restricting the prospects for steel exports in the near future. Considering that the country’s steel export volume in December 2022 was relatively low at 5.4 million tons, it is expected that there will be year-on-year growth and slight month-on-month fluctuations in December, with steel exports in 2023 anticipated to exceed 90 million tons.
When it comes to imports, the current state of the domestic manufacturing boom has continued to fall within the contraction range, thus putting pressure on the demand for steel. Nonetheless, China’s high-end steel import substitution capacity has significantly increased, indicating that the country’s steel imports will likely remain at a low level in the future. Despite challenges posed by the shrinking export orders, the prospects for steel imports seem more promising as the industry experiences a shift in import patterns with a focus on high-end products.
In conclusion, the continuous shrinking of export orders has resulted in restrictions on China’s steel exports. While there have been slight improvements in the month-on-month steel exports, the overall trend points towards a substantial year-on-year growth. However, the challenges associated with the shrinking export orders, the slow recovery in overseas supply, and the pressures on external demand from the global manufacturing sector have all contributed to a less optimistic outlook for the country’s steel industry. On the flip side, the import substitution capacity for high-end steel products presents an opportunity for growth in the import sector. As the industry continues to navigate through these challenges, it is important for stakeholders to strategize and adapt to the evolving dynamics of the global steel market.
Post time: Dec-07-2023