New Electronic Products Information

2014 end of the year, the steel industry to celebrate multiple positive, showing a rare industry optimism. Affected by this infection, the stock market staged a steel plate or "elephant dance" again, multivessel leading stocks daily limit.

In the past year, in the "new normal" supply and demand synchronized slowdown, low price volatility of raw materials and operating profit continued steel industry, China's steel enterprises into the transformation and upgrading of the window period: the weight shift to quality and type of development, capacity expansion began to cool, mergers and acquisitions simmering, benefits gradually. At the same time, due to the collapse of steel prices in the capital chain recombination events leading to the bankruptcy of more warn us: the transformation and upgrading, risks and opportunities.

2015 How the steel industry prospects? Various data indicate that the "new normal" will continue, winter is not over. How to promote change, exploring not only in line with the direction of industrial development, but also fit the actual breakthrough enterprise development path? Recently, a reporter with the Wu'an Yuhua Steel Limited (hereinafter referred to as: Yuhua Steel) relevant person in charge of the exchange, gained a lot of experience and advice available to industry reference.

Tip: good to be effective in "three low and one high," continued

From a macro perspective, all the way to boost steel demand from infrastructure investment brought a turning point to the area. In 2015, the steel industry seems to usher in a good start.

The fourth quarter of 2014, the National Development and Reform Commission on the approval of infrastructure projects are frequent "generous": December 22 - 23 in the Development and Reform Commission approved a total of eight days transportation construction projects, involving a total investment of 234.626 billion yuan . In fact, since October 1, Development and Reform Commission has approved 43 infrastructure projects involving airports, railways, highways, urban railway project, the amount of investment over one trillion yuan mark, reaching 1.3648 trillion yuan.

At the same time, as one of three strategic focus on the implementation of the country in 2015, "along the way" project directed signed overcapacity transfer, but also to many domestic steel prices saw the dawn of demand recovery. In addition, the future of China's marine economy has become the focus of strategic direction, resulting in a number of investment opportunities in the marine industries, the demand associated with the marine economy will increase, for marine equipment steel, steel vessels, offshore wind power steel, etc. bring a broad demand for space.

However, just as industry analysts said steel orders involved in infrastructure projects are potential future demand for steel, but the specific use of these items can not calculate how much steel, domestic steel prices could be assigned to the assigned number and mill location and production of varieties have a direct relationship, if you want to take care of the whole industry is still a little difficult.

On the other hand, low demand growth, low steel prices, steel prices low efficiency and high-pressure industry "three low and one high" new normal steel industry will continue. December 21, China Steel Industry Association released data show that: in 2014 the steel industry is expected to produce 810 million tons of steel, with an increase of 1.67% compared to last year; a substantial increase in export volume, but prices fell more than, or more than 10%, oversupply and overcapacity situation was a very obvious; although the benefit of iron ore and other raw materials prices continue to fall, or the steel industry profits will reach 300 billion yuan, but the industry is still at a low level of profitability. In addition, high corporate debt at current CISA member companies, the average asset-liability ratio as high as 72%, total bank loans more than 1.3 trillion.

"Opportunity shared equally impossible to every company in the steel industry. Whether the state-owned steel enterprises, or private steel enterprises, the first thing itself strong, stick to the end, and possible opportunities for beneficiaries." Yuhua Steel responsible people believe that the implementation of new environmental laws in 2015 the steel industry Forced unprecedented efforts, will further increase the pressure on the steel business; and at the same time, bank credit remains cautious on steel prices, the duration may be longer, but many small-scale debt ratio is too high steel prices will face a severe winter; a year after the crash, the iron ore is likely to continue at low levels, but prices fell space is very small, not even rule out the possibility of a slight rise; while steel prices after several years adjustment, internal compression space saving is extremely limited, no drop down; upgrade has suffered technical, personnel, marketing short board. By superposition of these factors, some of the strength of weak steel prices will face a shortage of cash flow, financing difficulties exacerbated the vicious cycle eventually be eliminated.

Recommendation: near steel industrial diversification, remain robust capital chain

For businesses, the bigger, often corresponding capacity expansion, excessive diversification; increased debt means borrowing money, capital chain tight. "These two are eventually capital chain tension, and as an important asset industry with plenty of money simply did not move an inch." The official said, Yuhua Steel has a very clear understanding of this. Under the leadership of founder Mr. Wang Zhangtian, Yuhua Steel has always focused on the steel industry, and investment by consolidating nearly steel chain, improve the industrial layout.

Big but not strong steel prices in the industry is that many winter defeated reasons. In this regard, the implementation of Yuhua Steel "doing fine, so specialized, and stronger" development strategy, and vigorously promote technological innovation, product structure and process structure gradually optimized to achieve the "quality" from ordinary steel to steel quality: a continued good parent material depth of product structure optimization and quality improvement, on the other hand, the further development and expansion of advanced cold heading steel, high purity stainless steel and other difficult species. At the same time, comply with industry trends of energy saving, since 2011 since the introduction of China Clean Development Mechanism Fund and other methods, and vigorously promote energy-saving, environmental governance, to achieve "green Yuhua," the new span.

After nearly three decades of development, Yuhua Steel has formed by iron and steel smelting, mining development, international trade, finance and investment sector of the closed-loop chain operations; at the same time, and control of business operations three costs, the group reached an annual output current 7.5 million tons of steel, 4 million yuan tons of iron powder production capacity, more than 20 billion size of the Group's assets, financial structure is very robust.

It is worth mentioning that, in the main industry on the basis of stronger, Yuhua Steel began to try a small investment volatility, long cycle of the industry. 2014, 1 billion cash investment Yuhua Steel has become the first Premier Li Keqiang, personally signed by the country prefix private investment company China Minsheng approved the establishment of joint-stock company ("the people to vote") launched its shareholders. Due to always uphold the integrity of business, good credit, Yuhua Steel is China Minsheng Bank headquarters level strategic clients, while maintaining a good relationship with the Agricultural Bank of China, China Construction Bank, Ping An Bank and other financial institutions.

In addition, based on the Industrial financing difficult deep feelings, learn technology and service concept of Internet banking, in September 2014, on-line Internet Yuhua Steel invested financial information service platform - "too easy loan." Adhering to Mr. Wang Zhangtian "legal, safe and reliable" principle, get easy loan will "strictly control investment risk, the pursuit of steady income," as a business philosophy, on the one hand, for the financing of the project, was easy reference bank loan risk control system, so familiar the industry, customers are familiar with, familiar with the product, the risk prevention in the first place. On the other hand, austerity, reduce transaction costs, as much as possible to obtain a higher return for the financial people. Just one quarter, "get easy loan" chain finance platform has been done fast.

Now, Yuhua Steel has successfully completed the second generation succession, into Wang Shuhua era. Father and son two generations, one vision, focusing on strategic investments; a steady, pay close attention to the management, the formation of leadership style complementary advantages. Although in recent years the development of the industry downturn, but Yuhua Steel Development is very robust. 2014, at the China Enterprise Confederation and China Entrepreneurs Association released the list of the top 500 Chinese enterprises, and even improved its ranking: 500 459 among China, manufacturing 500 235, ranked 46 in steel prices bits.

Summing up enterprises winter experience, Yuhua Iron Head told reporters: no industry downturn, only to blame the business. Iron and steel industry as the country's basic industries, the development of a mature industry, market demand is still, steel prices should remain for the winter thinking counterparts, Lianhaoneigong, actively seeking to upgrade in the premise of risk control.

 

Above information is provided by one of  stainless steel sheet suppliers-Foshan Ocean Stainless Steel Co. Ltd.If you have any questions,pleased contact us.