The meager profit situation of the steel industry will continue in 2014

Recently, the Economic Daily's China Economics Industry Index Research Center and the National Bureau of Statistics China Economic Climate Monitoring Center jointly released a report. Pan Jiancheng, deputy director of the China National Economic Statistics Monitoring Center of the National Bureau of Statistics, said that the most important problem in the current industry is overcapacity. Under the policy orientation of steady growth, restructuring, and reform, this year's macro economy is expected to continue to maintain a stable and positive trend. Domestic steel demand can still grow to a certain extent, but the growth rate may fall back. At the same time, with the implementation of the "Air Pollution Prevention Action Plan" and the "Guiding Opinions on Resolving the Severe Overcapacity of Production Capacity", the release of new capacity in China's steel industry will be suppressed, and the pace of eliminating backward production capacity will accelerate, steel supply and demand. Will be in a weak balance. Steel prices are expected to receive a certain degree of support, but the low-level consolidation situation is difficult to change, the steel industry's meager profit situation will continue.

The results of the boom monitoring show that the China Economic and Industrial Industry Climate Index has remained stable for six consecutive quarters, with fluctuations of only 0.2 points. In the fourth quarter of 2013, the industrial and key industries in China were generally stable, with a number of operational indicators showing stable performance.

In the fourth quarter of 2013, the China Economic and Industrial Industry Climate Index was 95.3, which was basically the same as the previous quarter (0.1 point slightly). From the point of view of the key industries monitored by the index, in addition to the slightly volatile fluctuations in the cement and power industries, the prosperity of nine industries, including equipment manufacturing, coal, petroleum, steel, non-ferrous metals, chemicals, and home appliances, remained flat or basically the same as last quarter. From the perspective of production, the growth rate of industrial production was 10.0%, which was basically the same as the growth rate of the previous quarter (10.1%). From the price point of view, from October to December 2013, the industrial producers’ purchase price and ex-factory price increased almost all. Zero growth; from the perspective of employment, at the end of the fourth quarter of 2013, the number of industrial enterprises above designated size increased by 1.8% year-on-year, which was basically the same as last quarter.

“The stability of economic operation is rare in history.” Pan Jiancheng said that at present, the overall economy is reflected in “stable”, the global economy is in a low-speed growth zone, major developed economies such as the United States and Japan, and major developing economies such as India. In the case that the growth rate of the body is much lower than that of China, the industrial climate index has maintained a steady trend and it is not easy.

The data shows that China's gross domestic product (GDP) has fluctuated between 7% and 8% for seven consecutive quarters. The price of industrial producers has changed to zero for three consecutive months, and the growth rate of industrial GDP has remained stable.

Pan Jiancheng said that behind these figures is essentially the optimization of the development structure, the consumption-related industry sentiment index is rising, and the resource-related prosperity index is declining. A steady economic growth can avoid the vicious cycle of excessive consumption and excessive idleness caused by ups and downs, avoid frequent changes in policies, increase the adverse impact of economic growth uncertainty on business operations, and provide a relatively loose economy for reform and transformation. Operating environment. However, there are still many downward pressures in the operation of the industrial economy. Overcapacity and insufficient demand are still the primary issues that constrain current industrial growth. “The accumulated excess capacity in industries such as steel is difficult to digest in a short period of time,” said Pan Jiancheng.

He believes that to maintain stable and good growth of industry and reduce volatility, it is necessary to increase reform and transformation on the basis of giving full play to the role of the market; continue to increase marketization rate, actively promote private investment, and promote the degree of marketization to reform expectations, and maintain Healthy manufacturing development. In the past, the reason why the industrial economy was able to maintain a high level of steady growth for a long time, to a certain extent, benefited from the country's relevant steady growth policies and the reform measures to release the vitality of enterprises. The results of the hyperbolic monitoring of the China Economics Industry Climate Index show that after further eliminating the random factors such as policies, in the fourth quarter of 2013, the China Economic and Industrial Boom Index fell slightly, 1.6 points lower than the index value without removing the random factor. The difference was 0.2 points higher than the previous quarter. From the trend of the whole year's economy, the industrial climate index that excludes random factors continues to be lower than the index value without removing random factors. This shows that relevant policies and measures have played a positive role in the steady growth of industry. In the past year, industrial efficiency has improved, industrial profit growth has improved significantly, and overall operational quality has improved. At the same time, the consumption and equipment manufacturing industries accelerated, and the expansion of the “two high” industries was gradually curbed, and the industrial structure was continuously optimized.

According to the report, looking forward to 2014, as the fundamentals of China's economic development are still good, and various favorable factors at home and abroad continue to accumulate, the industrial economy is still steadily improving. It is estimated that the industrial economic prosperity index of the first quarter and the second quarter of 2014 will be 95.2 and 95.3, respectively, and the industrial prosperity will tend to be stable.

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