Leading steel prices fell steel anti profits surge
Steel plate movements magnificent, but the brokerage researcher lamented "the people have been scattered."
Recently, the China Iron and Steel Association (CISA said under) released statistics in 2014 will focus on steel enterprises realized profits of more than 30.44 billion yuan, a three-year high. At the same time, since 2014, China's steel prices are at record lows.
Profits and prices contrary, this bizarre landscape of so many investors "can not read." 2014's "Steel feeling" What is one example, or the new normal? 2015, Steel City turn how to interpret?
Iron ore, steel prices decline outperformed
Steel Association released data show that in 2014 focused on steel prices realized profits 30.4 billion yuan, an increase of 40.4%. Some listed companies release earnings forecasts, and also seems to confirm this "warm." WISCO 2014 performance forecast disclosure, net profit attributable to shareholders of listed companies grew more than 150 percent during the reporting period. Chongqing Iron & Steel is also expected to last year attributable to shareholders of listed companies net profit of about 50 million yuan, in 2013 a loss of up to nearly 25 million.
Strangely, 2014 steel prices have been in a "bear market", when Shanghai rebar prices are down 19.41%. "All along, the steel industry profits are now marching in, there was a departure from last year." Shanghai brokerage researcher "Securities" reporter contacted said.
In this regard, analysts 畢紅兵 explained to reporters, the emergence of this divergence, mainly because of decline in iron ore and other raw materials is greater than steel, iron ore prices in 2014 fell 47%, steel prices dropped significantly in operating costs caused gross margin the bottom of the upgrade. And last year, although demand continued to decline, but the downstream steel industry has not yet occurred to the inventory, resulting in revenue decline rate is relatively stable.
Steel plate "people have been scattered."
With the focus on steel prices to pick up unexpected profits, the steel plate in the secondary market quietly started a wave of surging prices. Flush iFinD Steel Index show that last June 20, the index fell 982 points, December 22 rocketed to 1967 points, or double, the index yesterday to close at 1922 points.
But have to admit, the former star of the market - steel plate "people have been scattered." Qilu Steel team released a latest research report, it is weird smells. "Since June 2014 at the bottom of the steel plate is recommended, since many steel stocks have been achieved doubled, but still get the job Qilu Steel team named the new wealth," the researchers said the iron and steel sector sentiment remains in the doldrums, exchanges and market down, some investors even do not know the specific subject of ore stocks. Also, from the comparison of institutional ownership at the end of 2014 and third quarters several ore stocks of view, a lot of raised funds to exit.
The aforementioned Shanghai researcher with respect, although some improvement in economic and medium-sized steel enterprises, but industry sales profit margin is only 0.9%, the lowest level is still in the industrial sector. Also, if iron ore prices fall further, there will be more non-mainstream mining and domestic mine shutdown late ore prices are expected to be supported at the bottom. "The problem is that many organizations concerned with profits to pick up last year, 2015 Is there continuity?" He said.
"Securities" reporter found, which, given the very different answers brokerage. February 26 Qilu Securities ore stocks rating to BUY full and comprehensive look at more than the steel stocks. The reason is that the seasonal switch overlay inventory cycle will lead to increased procurement industry chain, pushing up demand for steel mill operating rates and ore. On the demand concentrated outbreak of ore price is expected to usher in a moderate level of rebound.
The Changjiang Securities believes that, given the domestic demand continued to trend downward pressure superimposed downstream to the library and exports to return to reason, unless steel prices because demand is affected by the cycle of short-term upward swing or government stimulus than-expected rise, otherwise the steel industry in 2015 profit continue to improve the lack of upward flexibility will still hovering at a historic bottom.
Small and medium sized steel enterprises beat'em
During the interview, Bi Hongbing does not hide the long-term bullish on the steel industry. His "Securities", told reporters outside the area all the way to the main tone, internal collaboration will focus on the development of Beijing, Tianjin and the Yangtze River Economic Belt, and the resulting infrastructure and the entire Chinese industry promotion, will give the industry opportunities. Although China's steel output ranks first in the world, but still rely on imports of high-end steel products, with the effective release of the productivity of high-end steel, the steel industry still have prospects.
Metallurgical Industry Planning Research Institute Li Chong put it bluntly, low-growth, low-cost, low efficiency and high pressure will be the new normal steel.
In this process, the pressure of survival faced by small and medium sized steel enterprises increasingly grim. February 5th National Development and Reform Bureau released regulate economic operation of the steel industry in 2014, in 2014, the steel industry realized profits of 219.2 billion yuan, down 15.3%. And Steel Association released data for more than easy to see that small and medium steel enterprises being Ebb Tide. There are statistics, the implementation of new environmental laws this year, about 70% of the iron and steel enterprises is not up to the present downturn in steel prices on the industry, "most stringent" environmental law will undoubtedly be their "Red Heat."
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