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Steely industry: Export increased demand August under anticipate
From;    Author:Stand originally

According to custom preliminary data, exit of Chinese iron and steel was 7.68 million tons August, rise compared to the same period 43% , annulus comparing rises 7% . The entrance is 1.33 million tons, drop compared to the same period 9% , annulus comparing drops 8% . Only August outlet is 6.35 million tons, rise compared to the same period 62% , annulus comparing rises 10% .

Analysis

(1) although we had not obtained the yield data August, but understand according to us, in rolled steel price from peak value fall after a rise 10% after bringing about small-sized and steely enterprise to be immersed in deficit, heibei saved the stop production of small-sized steel ironworks of 50% above August. The crop August should be met under July, and the yield that achieved a digit only July grows (grow 9% compared to the same period, and 2007 annual compared to the same period amplitude is 16%

(2) imports slow down, exit to increase below the setting of price fall, this means demand decreasing quickly.

Potential effect

We predict domestic steely price will fall further, because:

(We have not see 1) sole of cycle of estate be issued to lower levels.

(The raw material price fall that 2) produces as iron and steel, company of iron of little profiled bar / limit production business may resume production. Coke price is a RMB 2, 700 yuan / ton (contain) of value added tax, relatively RMB 3, 050 yuan / ton the near future drops bit higher 11% . Price of domestic iron ore is a RMB 1, 250 yuan / ton, relatively June RMB of peak value level 1, 600/ ton drop 22% . We estimate, the wool interest rate of company of iron of little profiled bar already from August before low of half-moon near future - 3% pick up to 4.8% .

In view of price difference still bigger (hot-rolling steel price of China is 820 dollars / ton, and American market price is in 1, 000 dollars / ton above) , we predict steely exit of China will still maintain higher level.