Reviewing the steel market in 2013, although the trend of steel prices continued to fluctuate, the overall situation is still gloomy. The steel prices of the whole year fell to the level of 20 years ago. In the general downturn of steel company profits, the increase in environmental pressure has become the “last straw” overpowering inefficient steel companies.

Recently, Vice Chairman and Secretary-General Zhang Changfu of the China Iron and Steel Association said at the “My Steel” annual meeting that China’s crude steel production this year may reach 882 million tons, and next year it will maintain a growth rate of 2% to 3% to 800 million tons. . The difficulties and bottlenecks encountered in the development of the iron and steel industry are the contradictions accumulated in the rapid development of the past 30 years. It is by no means a three-five-year period that the regulation can be effective. The thinking of “relying on the release of production capacity, increasing the diluting costs of production capacity, and earning profits to lead the opponent” has not been effective.

In this regard, as stated by the above-mentioned senior official of the China Iron and Steel Association, China, as the world’s largest producer and exporter of steel products, has for many years been faced with industry defects of overcapacity and insufficient product technology content, and it is undeniable that Such an industry defect is also an important reason that restricts the transfer of domestic steel products to the upstream of the industrial chain. In this regard, the author believes that whether the domestic steel industry can effectively achieve industrial chain transfer in the following several periods may be the key to whether or not the market can play a decisive role in the allocation of resources.

In fact, as far as the relationship between the steel industry and the market is concerned, it must be admitted that the overcapacity of domestic steel products has not been alleviated in the past considerable period, and even to some extent it has become increasingly serious. There may be various reasons behind this, but one of the important reasons that cannot be denied is that, in the past, the implementation of local steel projects has largely been based not on market needs, but precisely on the needs of local GDP. . The reason is simple, because once the steel project is approved, the huge investment results can make a significant contribution to local GDP.

And perhaps it is because of this reason. For a long time in the past, on the one hand, although the relevant authorities of the country have repeatedly warned about the overcapacity in the steel industry and even carried out industry consolidation, the local government still The “zero” method has been circumvented by policies such as the Shangma Iron and Steel Project. At the same time, in order to preserve the contribution of relevant steel production capacity to local GDP, some local governments are aware that the production capacity of some local iron and steel projects is significantly behind the production capacity. In the case of elimination, we still do not hesitate to use policy tilt to support local backward production capacity projects.

It can be said that it is precisely because there is such excessive local intervention in local power from private interests that the domestic steel industry has not only failed to achieve the goal of shifting to the upper reaches of the industry chain, but also overcapacity the domestic steel industry. The problem is getting worse. In this regard, the existence of the overcapacity problem in the domestic steel industry has not been able to ease. In essence, it should be a question of the relationship between power and the market. It is an issue that should or should not allow the market to play a decisive role.

Therefore, in the face of the above-mentioned concerns raised by high-level officials of the China Iron and Steel Association on the overcapacity in the domestic steel industry, the author believes that the most difficult and bottleneck the steel industry currently faces is, although it can be said at a specific level, how to solve the problem of overcapacity. In fact, it should still be a relationship between power and the market. It is a matter of whether or not the market should play a decisive role. It should be said that this is the first prerequisite for the healthy development of the domestic steel industry.

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