Serious overcapacity in China's steel industry is unlikely to ease in 2013, which could continue...


Serious overcapacity in China's steel industry is unlikely to ease in 2013, which could continue to hamper steel prices (SLX), analysts say at Platts Steel Market Europe conference. China is set to produce ~750M metric tons of crude steel in 2013 while capacity will rise to 950M, putting heavy pressure on steel prices in Europe and in the world steel industry as a whole.
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Comments (7)
  • Tom Guttenberger
    , contributor
    Comments (714) | Send Message
     
    You raise steel production capacity by mining and burning a lot of coal. I guess we will have to wait for the next contradictory headline in the morning, so a rally in this commodity can be sufficiently muted.

     

    Yawn.
    23 May 2013, 06:05 PM Reply Like
  • Scottonthespot
    , contributor
    Comments (26) | Send Message
     
    Does this account for China's Sky City?
    Its 220 stories will provide a total of 1 million square meters of usable space, linked by 104 elevators.
    http://bit.ly/10nYlpg
    and
    http://bit.ly/18lXk2V
    This is supposed to be just the beginning of a multi-decade plan to rehouse half a billion Chinese. That would use a bit of steel, no?
    Supposedly, it's been approved.
    23 May 2013, 06:29 PM Reply Like
  • Ben Simonton
    , contributor
    Comments (20) | Send Message
     
    How does 750 mt compare to demand in China? Will China be an exporter?
    23 May 2013, 07:49 PM Reply Like
  • PeterScriabin
    , contributor
    Comments (356) | Send Message
     
    Econ 101 says a shift to the right of the steel-supply curve is a POSITIVE for iron-ore suppliers (this was sent to CLF subscribers as well as MT).

     

    The price of steel falls, quantity demanded increases, so quantity of iron required also increases.
    23 May 2013, 09:03 PM Reply Like
  • rwaem
    , contributor
    Comment (1) | Send Message
     
    For what it's worth the Great lakes ore carrying ships are moving a tremendous amount of ore from the Upper Lakes area to the steel mills located in the Southern Lakes region. I worked these ships for better than 35 years and receive companies status reports. Somebody is buying ore somewhere and using it!
    24 May 2013, 02:20 AM Reply Like
  • ShanTuo
    , contributor
    Comments (14) | Send Message
     
    to rwaem: People we've known and admired - Pillsbury, Longyear, Bennett - the Massabi's founding fathers. Cascade is closing up in the UP and Messabi Trust is pretty much in Cliff's pocket. I hope there's a domestic purpose for the Massabi product - otherwise, it looks like a long cold winter. The worst thing about the slump in this market for the people up in Hibbing is that there has (recently) been so much planning activity for new and massively more efficient processes like DRI and possible direct through feed steel mills that would produce finished steel products right there on the Messabi. I guess we're used to it...
    24 May 2013, 01:28 PM Reply Like
  • sulo
    , contributor
    Comments (111) | Send Message
     
    It is hard to objectively read or watch the news regarding the mining industry, as the short interest crowd has driven the sector heavily down. A few years ago clf was over a $100 stock and it is now at $20. Worldwide economic conditions justified part of that slide, but in my opinion it is overdone. I also believe the Chinese government will stimulate their economy rather than holding back growth.Make your own calls on investments---is clf likely to go up over tne next few years??
    24 May 2013, 03:25 PM Reply Like
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