EGP nudges higher vs. USD in early Thursday trading    Global electricity demand to surge through 2026 – IEA    Japan's c. bank holds key interest rate    Egypt, US FMs discuss Gaza crisis, Nile water security    Egypt's Electricity Ministry says new power cable for Giza area operational    Egypt exports first high-tech potato seeds to Uzbekistan after opening market    Modon Holding posts AED 2.1bn net profit in H1 2025    Egypt's Al-Sisi, Italian defence minister discuss Gaza, security cooperation    Egypt's FM discusses Gaza, Nile dam with US senators    Aid airdrops intensify as famine deepens in Gaza amid mounting international criticism    Health minister showcases AI's impact on healthcare at Huawei Cloud Summit    On anti-trafficking day, Egypt's PM calls fight a 'moral and humanitarian duty'    Egypt strengthens healthcare partnerships to enhance maternity, multiple sclerosis, and stroke care    Egypt keeps Gaza aid flowing, total tops 533,000 tons: minister    Indian Embassy to launch cultural festival in Assiut, film fest in Cairo    Egyptian aid convoy heads toward Gaza as humanitarian crisis deepens    Culture minister launches national plan to revive film industry, modernise cinematic assets    Sudan's ambassador to Egypt holds reconstruction talks on with Arab League    I won't trade my identity to please market: Douzi    Sisi sends letter to Nigerian president affirming strategic ties    Egypt, Senegal sign pharma MoU to unify regulatory standards    Two militants killed in foiled plot to revive 'Hasm' operations: Interior ministry    Egypt, Somalia discuss closer environmental cooperation    Egypt's EHA, Huawei discuss enhanced digital health    Foreign, housing ministers discuss Egypt's role in African development push    Egypt reveals heritage e-training portal    Three ancient rock-cut tombs discovered in Aswan    Sisi launches new support initiative for families of war, terrorism victims    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Egypt's Irrigation Minister urges scientific cooperation to tackle water scarcity    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



China's steel prices are on the rise and that's worrying Beijing
Published in Amwal Al Ghad on 10 - 08 - 2017

China's steel prices are soaring, and the government is getting worried about striking the right balance on the markets.
China, the world's largest steel producer, has been working to tackle overcapacity in the sector, as the government seeks to find economic growth outside of heavy industry and manufacturing, The cutbacks also come amid long-time claims by the U.S. and Europe that China was selling its unwanted steel at lower prices on global markets, hurting producers elsewhere.
In March, the government announced plans to slash steel capacity by 50 million metric tons this year in efforts to tackle pollution and curb excess supply. Experts say the prospect of limited steel is pushing prices up, and it's got authorities worried about market volatility. China is also the world's top steel consumer, so higher prices translates to better profits for industry, but it also means increased costs for sectors like construction that use much of the alloy.
The government is convening meetings this week with regulators and industry executives as prices have surged, Reuters reported, citing a source at the China Iron and Steel Association.
For Beijing, it's a tough situation: tackle steel overcapacity, rebalance economic growth, control environmental pollution and also manage market stability — especially in advance of a leadership shuffle due in the fall.
So far this year, steel rebar futures have rallied on the Shanghai Futures Exchange — the September 2017 contract is up 40 percent to date, and is sitting today at around 4,131 yuan, according to Reuters data.
Even on Monday, the price of hot-rolled coil, a key steel product, surged 5 percent after Hebei province announced new measures to limit steel production to half of its capacity during the winter months, Nomura analysts wrote in a note. Hebei accounted for nearly one-fourth of China's total steel production in the first half of this year.
In the long run, analysts and companies expect higher prices to stay as the cutbacks continue, with China's curbs estimated to reduce overall crude steel production by 5 to 10 percent, according to Nomura. China's steel exports are likely to continue to dip, after falling in July, said Charles Bradford, metals analyst and president at Bradford Research.
"Output in China's steel industry has sometimes been curtailed temporarily in order to tackle environmental problems, but we think the production cutbacks in the latest measures will be substantial compared to the other occasions," wrote the Nomura analysts.
For industry, that's good news when it comes to stronger earnings, especially after China's faltering economic growth triggered a rout in global commodities over a year ago, prompting industry to pull back on investment and jobs.
S&P Global said on Wednesday it expected India's Tata Steel to see healthy profitability for the rest of the year. Japan's steel industry is also seeing a boost in export margins. And South Korea's steel industry is poised to benefit with less Chinese steel coming in — the country is a major steel export destination for China, and firms there have been in fierce competition with the Chinese.
Baoshan Iron and Steel, China's largest steel company, fell around 3 percent in the Thursday morning session, but is up 30 percent so far this year.
Source: CNBC


Clic here to read the story from its source.