The iron and steel industry in 2018 presents four characteristics

Driven by a series of reform measures, such as eliminating excess capacity and clearing floor steel, the operation of the steel industry improved in 2016, improved significantly in 2017 and maintained a steady and good development trend in 2018.

First, the supply and demand of the steel industry tend to be reasonable. From 2016 to 2017, the total production capacity of crude steel will be 120 million tons, 24.7 million tons will be reduced in the first seven months of 2018, and more than 80% of the total 30 million tons will be reduced in the whole year. The withdrawal of ineffective production capacity makes room for high-quality production capacity, and the utilization ratio of steel production capacity restores to a reasonable range of about 80%.

From January to October, crude steel output reached 783 million tons, an increase of 6.4% over the same period last year. According to the data of the General Administration of Customs, China exported 58.41 million tons of steel in the first 10 months, imported 11.103 million tons and exported 47.307 million tons net, equivalent to about 733 million tons of crude steel apparent consumption. The industry's supply and demand tended to be reasonable.

Second, the fluctuation of high steel prices tends to slow down. According to the monitoring data of the price monitoring center, the average price of the major steel wholesale market in China in the first 11 months was 4545 yuan per ton, up 11.22% from the same period in 2017, the highest level since 2013. Since the average price of steel stood at 4,500 yuan in the fourth quarter of last year, this year's steel prices have been fluctuating around this level. There has been no significant rise or fall. The biggest rise or fall occurred in August (3.57%) and January (5.7%) respectively. In the first 11 months, the ring-to-ring fluctuation amplitude was 9.26%, lower than 14.75% in the same period last year and 19.62% in 2016.

Third, corporate profits have risen sharply. From January to October, the profits of Industrial Enterprises above the national scale increased by 13.6%, of which the ferrous metal smelting and calendering industry increased by 63.7%, ranking in the forefront of 34 industries whose total profits increased year-on-year. The profit level of iron and steel industry has returned to the average level of industrial industry, creating a new situation.

Fourth, steel export volume continues to fall and export volume continues to rise. Steel exports continued to fall in 2018, with exports of 63.78 million tons in the first 11 months, down 8.6% from the same period last year, but the amount of exports declined from a cumulative decline in the same period last year to a significant increase. Imports of 12.16 million tons, up 0.5% year-on-year, and imports also increased.