Galvanized steel pipe market price is weak and stable, the price of strip steel is rising steadily, the price of pipe continues to rise, seamless pipe market is weak and stable, and the price of profile market is strong. The problem of overcapacity has appeared many times before in China. However, from the example of the steel industry, it is rare that the scope, quantity and impact of the current round of excess capacity are so wide, so large.
The background of this round of excess capacity is the decline of external demand caused by the international financial crisis. Especially, China's economic development has entered a new normal state. The growth rate has changed from high-speed growth to medium-high-speed growth. The transformation of comparative advantage has put China in a painful period of structural adjustment, which makes China in the period of high-speed economic growth, according to the original comparative advantage. Overcapacity has emerged in the construction of potential allocation. Some analysts believe that the galvanized steel pipe mill lacking funds can obtain the support of foreign capital. "For small enterprises or private enterprises, the introduction of foreign capital will help optimize the investment structure and promote innovation and upgrading."
Under the influence of this atmosphere, the price reversal of threaded steel is always heard, but the author believes that the domestic and foreign economic environment is not conducive to the recovery of the steel industry, downstream demand continues to be depressed and sales pressure of steel mills increases to suppress the rebound of the price of threaded steel, galvanized steel pipe prices will oscillate for a long time in low-level consolidation. The just concluded NPC and CPPCC sessions have clearly defined the key tone of stabilizing economic development and strengthening economic transformation, increasing resource and environment constraints, rising labor costs and other factors, and the way of development with high input, high consumption and emphasis on quantity expansion has become unsustainable.
These contents have pre-restricted the possibility of a substantial increase in screw steel from the aspects of capital and demand. As an overcapacity industry, the iron and steel industry itself will no longer receive too much support from the state policy. At present, the whole industry is weeding out and annexing some backward productivity with low technology content and unsuitable steel enterprises through market-oriented way. The decline in the profitability of the iron and steel industry is not only the result of overcapacity, but also the direct manifestation of overcapacity. The serious excess of production capacity, the industry as a whole at the edge of profit and loss, so that the ability of enterprises to transform and upgrade declined, seriously affecting the healthy development of the industry.