This year, the steel industry is facing a severe situation in the era of fierce competition. This competition lasted for a long time, with strong fluctuations and deep impact. The steel industry seems to have entered a reshuffle stage that is related to life and death. In this industry reshuffle, various steel companies continued to "roll inward", and the operation of the steel industry showed a "three highs and three lows" situation of high output, high cost, high inventory, low demand, low price and low efficiency. Compared with the domestic market that is constantly rolling inward, domestic steel companies are more competitive in the overseas market. According to statistics from the General Administration of Customs, China exported 9.888 million tons of finished steel in March, up 37.9% month-on-month and 27.8% year-on-year, reaching the highest level since July 2016. From January to April, the cumulative export was 35.024 million tons, up 27% year-on-year. In April, China imported 658,000 tons of finished steel, up 6.64% month-on-month and 12.47% year-on-year.

1. This year's monthly export volume hit a new high, and the increase in billet exports reached 161%.

In 2023, China became a net importer and exporter of billets for the first time. As the growth of domestic production exceeded the growth of demand, it promoted the development of overseas export trade. In addition,China filled the demand for billet trade in the EU and Southeast Asia when necessary. These are the driving forces for my country to become a net exporter of billets. In March, the export volume of this variety increased by 161.1% month-on-month, and Italy became China's largest export destination for billets for 6 consecutive months. As the European Commission banned the import of Russian billets from April 1, the local supply gap may expand accordingly, and it is expected that China's billet exports to EU countries may continue to grow.

2. The supply of overseas steel markets rebounded year-on-year, and China's steel exports were under pressure.

Although global crude steel production showed a slight year-on-year decline, steel production in major steel-producing countries and regions in the world gradually recovered, and steel production in other parts of the world except China continued to recover. Ukraine is the main importer of steel and metallurgical products in the EU region. The gradual recovery of Ukraine's steel industry may squeeze the EU's demand for Chinese steel. Major Ukrainian steel mills, such as ArcelorMittal Kryvyi Rih and Metinvest Group, have begun to formulate plans to resume production and rebuild export logistics channels through European seaports and the port of Izmail in the lower reaches of the Danube in southern Ukraine. According to the Ukrainian Steel Association, Ukraine's crude steel production reached 2.4 million tons in January-April 2024, a year-on-year increase of 32.8%; pig iron production reached 2.18 million tons, a year-on-year increase of 25.1%; and steel production reached 1.97 million tons, a year-on-year increase of 25.1%. Among them, crude steel production in April reached 714,700 tons, a year-on-year increase of 24.5%; pig iron production reached 596,900 tons, a year-on-year increase of 9.7%; steel production reached 584,300 tons, a year-on-year increase of 19.9%. On May 7, the Ukrainian Prime Minister stated at a government meeting that Ukraine's exports in April have gradually returned to pre-war levels.

3. Low-priced resources flow into overseas, and anti-dumping policies against China are frequently issued. In recent years, the continuous expansion of global steel production capacity has led to an imbalance in market supply and demand, a drop in steel product prices, and intensified competition. With the rapid development of China's steel industry, the export volume has increased significantly, making it one of the world's largest steel exporters, which has also made China's steel industry the focus of international trade frictions. Coupled with the depreciation of the RMB in the short term, China's steel export prices have continued to fall, strengthening the competitiveness of China's steel export quotations. In recent years, the number of anti-dumping cases suffered by China's steel industry has continued to increase, involving multiple countries and regions. The products subject to anti-dumping mainly include steel plates, steel pipes, rails, etc., which occupy an important position in China's steel exports. Against the backdrop of a weak global economic recovery, many countries have taken measures to implement anti-dumping and other trade relief measures against foreign steel products to protect their own industries.

In recent years, Chinese companies have fully participated in international market competition, and export trade has grown steadily. Against the backdrop of the increasingly accelerated internationalization process, in order to effectively control export trade risks and achieve low-risk export operations, export companies need to develop a practical risk management system. At the same time, it is necessary to strengthen supervision of the steel industry, promote industry self-discipline and standardized development, and reduce the risk of international trade frictions.

The above content is excerpted from：https://gc.mysteel.com/a/24051411/19A3371CC08038CF.html