Iron and steel production capacity to: Tim warmer steel production capacity should not be a worry to the pressure of
"In the first seven months, China Hot Dipped Galvanized Steel Sheet
production capacity to complete the annual task only 47% of the amount of progress than expected. China Securities Journal reporter in the top two steel production in Hebei and Jiangsu provinces research found that in the placement of workers, assets disposal, debt restructuring and other "old trouble" ridden the same time, steel prices continued to rise to become the current steel production capacity of the "new troubles."
In addition, to appear in advance of steel production process, "a press of the" targeted is not strong and other issues also need to be vigilant. In many places Yajian excess capacity when, regardless of the actual situation of enterprises market competitiveness, tough decomposition target may weaken certain legal compliance, good benefits the competitiveness of enterprises. Experts say that while the first seven months to lower than expected production schedule, but not the annual production capacity to target the problem, is expected to exceeded. Resolve the overcapacity in the steel, we can not neglect to cultivate strong steel prices with market competitiveness and sustainable development capacity, improve the international competitiveness of industry, or the capacity to effect will be greatly reduced. "
Prices rebounded to become the new annoyance
Wang Ming (pseudonym) is a large steel enterprises in Hebei Province Leader, employee relocation program after some time ago released, he sighed with relief. "Hebei Province is the country's iron and steel production in the largest province, but also to capacity the most important tasks of the province, we have received the go productivity tasks. To properly to the production capacity, the most critical is how the proper placement of workers." Wang told the China Securities Journal reporter.
Wang Ming burden is not easy. "Our plan brewing for a long time, including the resettlement fund the buyout, other companies received their digestion and other aspects of business, the implementation of coordination and communication program takes a long time. Moreover, compared with the developed eastern provinces, Hebei relative financial weak industrial structure is relatively simple, low economic capacity, it should implement the program very difficult. "
Even as the eastern province of Shandong, employee relocation same pressure is not small. "Shandong is mainly due to the placement of workers difficult shunt older workers, mainly in middle-aged, single skill, the ability to transfer the employment differential 40-50 years of age. Shandong than the major state-owned enterprises, 'Thirteen Five' period, only the mountain steel Group planned Yajian crude steel production capacity of 4.4 million tons, accounting for 30 percent of the province's Yajian task. and heavy burden on enterprises, thorough investigation by the end of 2015, Shandong province, 158 poor companies, two steel coal industry up to 29, about accounting for one-fifth of them, Hill steel Group debt ratio up to 81% of normal production operations is greatly limited, further increasing the difficulty of the placement of workers. "Vice president of China Iron and steel industry Association, Li Chong told China Securities Journal reporter He said in an interview.
According to the deputy chairman of China Iron and Steel Industry Association, Chi Jingdong calculated in accordance with the target January 22, 2016 the State Council executive meeting recompression of crude steel production capacity from 100 million to 150 million tons, and China's per capita steel production estimated 300 tons of steel, round steel to steel production capacity means that there will be 400,000 to 500,000 employees around the face adjustment or re-selection. In the capacity to process, how to make proper arrangements for the steel workers, the steel industry to become the largest production capacity problem.
Staffing problems are a microcosm of the iron and steel production capacity to the current face of many difficulties. In addition to the placement of workers, also face capacity to dispose of assets, debt restructuring, and many other "old trouble." In addition, different provinces have their own "trouble." China Securities Journal reporter found in the research, to the national steel output ranked second in Jiangsu Province, Jiangsu Province, although the strength of financial and economic capacity, employee relocation problem is relatively small. However, due to enterprises with logistics, marketing and other advantages, economic and competitive steel companies take the initiative to withdraw will is not strong.
In this context, the first seven months of this year, the national steel production capacity to complete only 47% of the amount of the annual task, significantly lower than expected. Progress each province is not one, Zhejiang and other provinces of the first to complete the annual task 4; Hebei, Liaoning and other eight provinces in progress between 10% -35%; more than 10 provinces to resolve the overcapacity in the steel work has not been substantial start. Among them, the top three of the country's steel production in Hebei, Jiangsu, Shandong progress to capacity concern. Li Chong said, "Thirteen Five" period, a total of three provinces plan Yajian crude steel production capacity of 81.81 million tons, accounting for Yajian task (1.5 billions of tons) of 54.5%. Therefore, these three provinces capacity Yajian progress and completion, go directly related to the production target task can be completed.
In the "old trouble" ridden the same time, steel production capacity to also encountered a "new troubles." August 16, the National Development and Reform Commission spokesman Zhao Chen Xin, in a news conference, before killing seven months to productivity slow progress of reason, in addition to many local and business thinking is not in place, the fear of difficulty two old issues, a new the situation is this year, steel prices rebounded to affect a number of local businesses and determination to capacity.
In late December 2015, with the cold-rolled coil and rebar prices rebound, the domestic steel market ushered in returning to the rebound. "It was for the steel price rally sustained, the industry differences are very large, and even the entire industry is no unified understanding after the Spring Festival, until April and May, before the formation of consensus expectations. The reason, mainly downstream infrastructure, real estate, and automotive industries demand-pull, and lower industry inventory, capacity is expected to have support, eventually forming a rising price spiral. "Wang told the China Securities Journal reporter.
Rising steel prices led directly to industry-wide production complex tide. In the first seven months, the national steel output did not fall. Songjeong in Tangshan City, Hebei Iron and Steel Co., for example, November 14, 2015, due to heavy losses, Songting Steel announced a cut, more than 6,000 workers "is a holiday." Liu Yiming (a pseudonym) will belong to one of them. But by the end of April this year Songting postpartum iron and steel complex, has been working to the field he was "invited" back. "Before the factory able to open four or five thousand a month, poor performance in recent years, my hand got left 3800 dollars a month, but better than working out strong, and now I am very happy the resumption of production to be back."
Prices driven by the resumption of production capacity to tide disrupted the plan. Nanganggufen Deputy General Xu Lin also found that, with the continued rise in the price of the original into a cut-off, semi-cut steel prices and full capacity up. "The original production capacity to the policy objectives and direction of the market is the same, but with the rebound in prices, reduction policy requirements, the market is to stimulate production. Moreover, this round of price increases in steel prices also continued to fall since bottoming out in 2010 rebound, with the capacity to go just at a crossing point to the production target to cause great resistance. "
This year, steel prices showed structural characteristics, capacity to make into a "negative development" the embarrassing situation. Li Chong told the China Securities Journal reporter, this year, steel prices appears broad, but the largest increase in the low-end steel. "The reason for this is, first, because as the most active rebar steel futures products, strong financial attributes, fluctuations in the futures market to some extent driven and amplified volatility rebar spot price; the second is a good real estate market than expected, driven by demand for rebar this year 1--7 months, the national real estate development and investment 5.5361 trillion yuan, an increase of 5.3%; real estate development enterprises housing new construction area of 929.44 million square meters, an increase of 13.7%. "
Compared to the low end of rebar triumph, but because of the high-end equipment manufacturing steel demand marine engineering, oil equipment and other downstream industry downturn and poor sales, and finally a "made missiles dry, but selling tea" phenomenon. "Go capacity ultimate aim is to promote structural adjustment and transformation and upgrading of the steel industry, which is the direction in recent years, large-scale iron and steel enterprises have been hard, but this happens to a lot of steel prices this year in promoting structural adjustment and restructuring and upgrading caused problems. for us, on the one hand to adhere to structural adjustment and transformation and upgrading of unwavering direction, on the other hand have to seize immediate opportunities to make money. "Xu Lin expressed.
Local conditions to promote capacity
"It should be an objective look at iron and steel to produce progress possible. Document No. 6 State Council on the steel industry to the production turnaround development was released in February, the first half of ministries, local governments, enterprises focus mainly on the development of supporting policies, task decomposition and communication convergence above. with the signing of letters of responsibility for the mission, policy system, establish a working system, iron and steel production capacity to enter in real progress, supervision and examination of the main stage. "Li Chong of China Securities, told reporters that although the first half schedule some lag, but the pressure to complete the annual production can not target the problem, and is expected to exceeded.
In the most important tasks of Hebei Province, the first seven months of the iron and steel production capacity to progress below expectations, but the China Securities News correspondent from Hebei Province Development and Reform Commission Industry Coordination Office to get the "Hebei Province in 2016 to resolve the overcapacity of steel monthly schedule "show, is expected to the end of November, Hebei Province, the cumulative phase-out 18.4 million tons of iron production capacity, 16 million tons of steel production capacity in 2016 and this year promises Yajian 17.26 million tons of iron, 14.22 million tons of steel production capacity plan, respectively, compared exceeded 106.6% and 112.5%. Only 10 single month, it plans to phase out Hebei iron production capacity of 7.86 million tons, steel production capacity of 6.8 million tons.
Meanwhile, around the irresistible force to the production process, but also against "one size fits all" problem. "Iron to the capacity required administrative measures and market instruments combined. However, in the present case, steel prices on the rise, and now is the 'golden nine silver ten', coupled to production capacity is expected to support the price of steel to the end is expected to remain strong. So only rely on the market to production capacity is not realistic, to be completed end of last year production target capacity, the need to rely more on administrative means strong advance, but relying on administrative means to the capacity of the process, to prevent the 'one size fits all' issue. "Wang expressed.
Recently, Li Chong discovered in the research process, a lot of people worried about the current steel prices is responsible for resolving overcapacity in the steel process, "a press of the." "Some places will Yajian simple task target decomposition, the actual development of the industry ill-considered, regardless of good or bad, a pressure is over. In many places Yajian excess capacity when, without considering market competitiveness of enterprises, production and operation, energy saving environmental protection, the actual situation, the work place is not detailed, tough decomposition of goals, there is no adequate communication and business; some companies do not even know that they have been included in the list of Yajian, in this case, it could undermine some of the legal compliance competitiveness, benefits are good companies, and even push it into the abyss. "
At the same time, due to the characteristics of each different provinces of steel production capacity, in advancing to the steel production process need to "local conditions." Hebei Province, the characteristics of its production capacity to one Yajian volume, "Thirteen Five-Year" Plan period Yajian steel 49.13 million tons, a third of the country's commitment Yajian mission; Second, private enterprises Lord, more than 90% Yajian task undertaken by private enterprises; Third, some cities bear the heavy task, Zhangjiakou, Langfang, Baoding need entirely cleared of steel production capacity, there are several areas need to clearing more than half.
"In response to these different characteristics, production capacity in Hebei Province to focus on strict control of the process of production capacity and the resumption of production equipment SUSPENSION, urged 'zombie companies' market-clearing, while consultations with Beijing, Tianjin, Hebei Province of cities in steel capacity reduction is clearly defining the ceiling. in addition, to accelerate the relocation of a major renovation project, the inclusion of "structural adjustment programs of the steel industry in Hebei Province," the two Jingtang Shougang, Tangshan Bohai steel removal, stone removal of steel, special Yongyang steel and Taihang, six major projects in Jinan city back into the park, set up a special working group, targeted to address constraints, urged early completion, early and deliver results. "Wang expressed.
And for private enterprises in Jiangsu Province, steel enterprises to exit the will is not strong, a high proportion of the characteristics of electric equipment, Li Chong said that it is necessary to strengthen environmental protection, energy consumption, safety, quality and industrial policy, joint law enforcement, and the integrated use of differential pricing and punitive price, price, and the cancellation of large consumers direct purchase of electricity trading and other economic instruments qualifications, Forced enterprises out; second is to use the advantages of strong provincial financial resources, increase enterprise exit award up efforts to guide enterprises quit .
In July, the State Environmental Protection Inspection Unit stationed in Jiangsu province on environmental issues related to the random inspections of all types of enterprises, Suqian, Yancheng, Lianyungang and Xuzhou Subei area as the focus of inspections, for some pollution seriously overweight and procedures are not complete enterprise, Inspection Unit requested the District Court together with the Environmental Protection Agency, the Public Security Bureau seized the enterprise, within the ambit of elimination of backward production capacity of. July 14, the Jiangsu provincial government held a provincial resolve the overcapacity of steel coal work conference. "Thirteen Five" period, Jiangsu Province will dissolve the iron and steel (crude steel) excess production capacity 17.5 million tons, of which, 2016 Yajian steel (crude steel) production capacity of 3.9 million tons. Industry insiders estimate that this will be included in checked enterprises in Jiangsu Province in 2016 backward production capacity out of the reserve list.
Li Chong pointed out that the current steel production capacity to go there pertinence issues that require attention. "Some Yajian capacity long ago not to participate in market competition, the staff has also been demobilized, ineffective production capacity, so Yajian capacity to improve industrial competitiveness, optimize the role of the market environment is minimal. The key focus should be on the ground and illegal bars production capacity, inefficient production capacity on corporate zombies. "Li Chong expressed.
Mergers and acquisitions to enhance competitiveness
During the "Thirteen Five", the capacity to become an urgent task. Li Chong reminder: "The current authorities, local efforts to resolve the overcapacity in the steel must be noted that, in resolving the excess steel production capacity at the same time, do not neglect to cultivate strong steel prices with market competitiveness and sustainable development capacity improve. international competitiveness of industry. There is no doubt resolve excess capacity is the current priority, but to cultivate strong world prices, improving competitiveness can not, afford to wait. If, after five years, to resolve the overcapacity goals are met, but did not form a group of the world strong first-class steel enterprise, then the excess capacity to resolve the role of significance will be greatly reduced. "
How to increase production capacity at the same time the competitiveness of enterprises, has become the focus of the moment a lot of large steel companies in the process of transformation and upgrading. "For Nanganggufen, the transformation and upgrading on the one hand to do strong steel main industry, the company's 10 million tons of crude steel production capacity, but also by the quality, efficiency and speed up the adjustment of product structure, value chain to do On the other hand, to strengthen and accelerate the development of non-steel industry, and constantly enhance the competitiveness of enterprises, improve the efficiency of enterprises. "Xu Lin expressed.
Speed up the adjustment of product structure is to improve the competitiveness of enterprises an important aspect, but also the direction of large steel companies over the years have been working. In Wang seems, product structure adjustment process is not easy. "Steel belongs to the upstream industry, the product structure of steel depends largely on the downstream demand. Furthermore, steel companies have their own sales radius, to some extent, the product structure and industrial structure are on sale corresponding Therefore, the steel industry the adjustment of product structure depends largely on the transformation and upgrading of the national industrial structure. in addition, now large steel enterprise groups within the industry in the implementation of customer-centric strategy, we are, but it also requires a very long process. "
Li Chong pointed out that should speed up the adjustment of product structure of the steel industry. First, we must strengthen the normative steel market, phasing out low-end products, to crack down on fake and shoddy steel products, to prevent shoddy phenomenon. Second, starting from the standard to develop higher standards of steel required, making some low-end products not up to standard requirements, and promote the overall improvement of the quality of steel products. Third, we must encourage technological innovation, research and development and promote the use of a new generation of high performance steel products, to replace imported products as well as replace the original steel products, so that product quality and product quality has been further optimized. Finally, we need to guide downstream users of high-end steel products, steel is used for the user to provide technical support, and users together to achieve mutual benefits.
At the same time, by way of mergers and acquisitions and improve industry concentration is both important means to enhance productivity and competitiveness of enterprises. According to statistics, in 2014 China's steel industry CR4 and CR8 respectively 19.46% and 32.37%, much lower than the concentration of the world's great powers of other steel industry level, such as CR4 Korea, Japan, Russia, the three countries were 90.91%, 83.44% and 82.43%. All along, the domestic steel industry, "small, chaotic, scattered," not only affects the pattern to enhance the competitiveness of enterprises, also contributed to the industry disorderly competition, overcapacity and to be able to yield an important reason for the difficulty.
March 2015, the Ministry issued the "steel industry restructuring policy," the draft stated that by 2025, the top ten steel enterprises crude steel production in the country accounted for not less than 60%, the formation of 3-5 in the world with a strong competitive large steel groups and a number of regional markets, market segment leader. In this context, this year June 26, Baosteel and Wuhan Steel shares both release suspension notice said: respectively received a controlling shareholder of Baosteel Group, Wuhan Iron and Steel Group, notification, Baosteel and Wuhan Iron and Steel Group is planning a strategic restructuring, the restructuring plan has not been determined, is subject to the approval of the relevant authorities plan was finalized. The matter may involve the company's major asset restructuring.
GF Securities pointed out that the two companies have overlapping products business, and are high barriers to product high degree of prosperity, after integration, to end the two companies compete competitive products, market share generally can reach 50% -90%. In the industrial chain, with the two companies a huge demand for raw materials and products generally higher market share, after the integration of the industry chain can enhance the bargaining power of upstream and downstream; project resources, Baosteel Zhanjiang project and Wuhan Iron and Steel Fangchenggang project product structure and radiation roughly the same area, after the consolidation is expected in the future market segments and product planning to make adjustments and avoid vicious competition, the formation of regional linkage and complementary products; in terms of international competition, Zhanjiang and Fangchenggang project is located along the coast, close to the ASEAN and India, Southeast Asia and the South Asian region in which the two countries in the future is the world's most dynamic economic region, but also important for the future of the steel consumption area, after the integration of national consumption is expected to upgrade the internal drive, an external "along the way", driven by export growth, enhance our steel prices in the international market competitiveness.
Li Chong pointed out that to promote the market structure effect major changes have a significant impact on the development of the iron and steel industry restructuring. By breaking restructuring of steel companies to produce catfish effect, pushing other steel companies restructuring, while breaking restructuring of the steel companies are also able to practice the policy of reform and other aspects of a breakthrough trip out of way. Wuhan Iron and Steel Baosteel restructuring is expected to play an exemplary and leading role for the subsequent steel industry mergers and acquisitions.
Meanwhile, Li Chong said the merger and reorganization of the steel industry but also to follow the law of the industry, as a guide good top roadmap. The steel industry is asset-heavy, technology-intensive and labor-intensive basic materials industry, industry characteristics very prominent, iron and steel enterprises to promote the restructuring has its own laws. Chinese iron and steel enterprises should co-ordinate the actual status of the world steel market and competition trends, mergers and acquisitions to strengthen the advantage to make up the short board, a strategic, forward-looking, operability road map is necessary.