Iron And Steel Industry Operation

（1） The production reached a historic high. From January to June 2013, the country produced a total of 390 million tons of crude steel, a year-on-year increase of 7.4%, an increase of 5.6 percentage points compared to the same period last year. In the first six months, the daily average production of crude steel was 2.154 million tons, equivalent to an annual production of 786 million tons of crude steel. Among them, it reached a historical high of 2.208 million tons in February, and although there was a decline from March to June, it remained at a relatively high level of over 2.1 million tons. From the perspective of provinces and regions, from January to June, the crude steel production of Hebei and Jiangsu provinces increased by 6.8% and 13.2% year-on-year, respectively. The total new production of the two provinces accounted for 42.4% of the national increase of 26.94 million tons, while other provinces such as Shanxi, Liaoning, Henan, and Yunnan also increased production by over 1 million tons. In terms of enterprise types, from January to June, the crude steel production of key large and medium-sized steel enterprises increased by 5.5% year-on-year, which is 2 percentage points lower than the national average growth rate. However, 60% of the increase in production still comes from key large and medium-sized steel enterprises.
（2） Steel prices are operating at a low level. From January to June 2013, the overall performance of the domestic steel market was sluggish. With the significant release of crude steel production capacity, the market supply and demand have become imbalanced, and steel prices have entered a downward channel, which has been declining weakly for more than four months. As of July 26th, the steel price index has dropped to 100.48 points, lower than 6.6 points at the beginning of the year. The prices of the eight steel varieties that the Iron and Steel Industry Association focuses on have all decreased to varying degrees compared to the beginning of the year, with an average decline of 5.7%. From a variety perspective, the prices of construction wire rods and threaded steel, which account for a large proportion of China's steel production, have decreased by 4.9% and 6.7%, respectively. The prices of medium and thick plates and hot-rolled coil plates have decreased by 5.7% and 9.7%, respectively.
（3） Steel exports have grown rapidly. The imbalance between supply and demand in the domestic steel market stimulates enterprises' exports. From January to June, China exported 30.69 million tons of steel, a year-on-year increase of 12.6%; Imported steel reached 6.83 million tons, a decrease of 1.8%, while imported steel billets and ingots reached 320000 tons, an increase of 50%. Converting billets into crude steel, Balance of trade totaled 25.06 million tons, up 17.3% year on year, accounting for 6.4% of China's crude steel output. From the perspective of export prices, the average price of exported rods and wires from January to June was 624.3 US dollars per ton, a year-on-year decrease of 18%; The board price is 835.2 US dollars per ton, a year-on-year decrease of 2.8%.
（4） High inventory operation in steel mills and society. The contradiction between supply and demand in the market has spread to the circulation field, and domestic steel inventory continues the growth trend at the end of last year. On March 15th, it reached a historical high of 22.52 million tons, an increase of 3.51 million tons from the previous year's peak. Among them, construction steel inventory was 14.32 million tons, accounting for 63.6% of the total inventory. Afterwards, as seasonal consumption increased, inventory gradually decreased, dropping to 15.4 million tons on July 26th. The oversupply in the market also pushed up steel factory inventory. In mid March, the steel inventory of key enterprises reached a historical record, reaching 14.51 million tons, a year-on-year increase of 29.7%. In late June, it dropped to 12.68 million tons, still an increase of 29.9% compared to the beginning of the year and 11.4% compared to the same period in 2012.