Regarding the phenomenon of rising steel prices, the vi […]
Regarding the phenomenon of rising steel prices, the vice chairman of the China Iron and Steel Association explained that, on the one hand, due to the initial increase in the reform of the supply side of the steel industry, the reduction in capacity has achieved certain results and the supply has decreased; on the other hand, it will focus on production after the year. The recovery of enterprises, coupled with the need for downstream industries to drive national investment policies, has a supporting effect on the good performance of steel. Due to multiple seasonal factors and investment perspectives, domestic steel prices have recently returned to normal, and it is hoped that they will not affect the supply-side reform process of the steel industry.
Industry analysts said that although the short-term is still a positive stimulus, futures, stocks and cash are not rebounding, but the market outlook will gradually reduce price increases.
From an economic point of view, the first quarter stabilized and improved in the second quarter, but the annual growth rate was still significantly lower than the previous year. In the case of downstream demand, it was not hot. The increase in crude steel production in March clearly shows that steel mills have resumed production in steel prices and their profitability has improved. However, most of the small steel mills have finally returned to supply and demand with prices that tend to balance again. It is determined by value. In the end, the price will encounter increasing resistance in the process of downstream transmission, and the price will be revised downwards and return to normal levels.
Rising prices of general raw materials trigger downstream products
For fastener manufacturers, all finished products come from iron ore, wire rods and other bulk raw materials are inseparable. The price increase of raw materials has pushed up too fast and too violently, making it difficult for downstream demand to follow up. The most demanding companies said that if the current market prices are unaffordable, they will raise their product prices in response to this “steel storm”.
How do fastener companies respond to the sudden "steel crisis" and improve their competitiveness?
Manufacturing method: control production costs and save resources. When purchasing raw materials for our fixed business, we actively purchase low-priced raw materials, which is conducive to the preparation of future mass production to reduce costs.
Mid-term preparation: In the face of rising production costs, price increases are not a long-term solution; improve product quality, strengthen product development, speed up the entry of automobiles, wind power, high-speed rail and other buildings to promote industry transformation and upgrading.
Late preparation: The demand for fasteners is huge. On airplanes, automobiles, down to furniture, electrical appliances, there is a vast demand. We need to segment the market and position it accurately. The market is wide and diversified. The traditional United States, Europe, Japan and other advanced industrial countries have limited expansion potential; to gain market share at the same time, we should pay attention to the importance of the development of emerging markets such as Central and South America, Southeast Asia, Africa, and the Middle East