Baosteel cut steel prices in the first quarter of next year domestic steel prices inflection point will now

Baosteel sharply cut the price of domestic steel prices in the first quarter of next year will turn the corner (reporter Shi Baohua) Baosteel yesterday announced a cut in the first quarter of 2006, steel prices, the average decline of 16%. Experts said that after the adjustment of Baosteel steel prices will be closer to the actual market demand situation. Moreover, this also indicates that the domestic steel prices from high to low inflection point inflection point.

According to Baosteel's price adjustment program, the largest decline in prices of cold-rolled and hot-rolled products. Among them, hot-rolled plate prices from the fourth quarter of this year, down to $4544 / ton to 3500 yuan / ton, a decline of more than 20%. Cold rolled plate from 5963 yuan / ton down to 4442 yuan / ton, a decline of up to 25%.

Lange Steel Information Center Director Ma Zhongpu said, compared with other steel companies, Baosteel products of high quality, there are differences in the target market, therefore, Baosteel's price will not produce great pressure on the domestic steel prices down. However, some steel mills will lower prices, and Baosteel to maintain a certain price difference.

Ma Zhongpu believes that the adjusted Baosteel steel prices closer to the actual level of the market. Domestic steel prices have been falling since March, hot plate, plate, steel prices are different degrees of decline, and even the abnormal situation of hot rolled plate price is lower than steel, Baosteel and the price is relatively high.

Expansion of China's steel production capacity is the main reason for the decline in steel prices. Haitong Securities analyst Yong Zhiqiang said that the new capacity continues to be released, but by the impact of macro-control, the limited growth in downstream demand. Therefore, next year the price of steel will run low. It is understood that, 1-10 months, the national steel production growth of 27%, while the market demand growth of only about 10%.

Ma Zhongpu said that the current decline in steel prices indicates that this round of steel industry cycle has maintained a high level of steel from low to low shock. On the international market, the European market prices began to fall in June 2005, the United States steel prices fell from September 2005.

Baosteel also means that the price of steel before the organization of enterprises to reach the limit of the implementation of the measures are difficult to implement. Haitong Securities analyst Yong Zhiqiang said that limiting production is not realistic. In the country's more than and 800 iron and steel enterprises on the scale of such a large-scale company, its market share of about 7% of the country. For more local enterprises, China Steel Association is difficult to coordinate.