Introduction to the processing of reamed titanium alloys

At the time when some large domestic steel mills lowered the prices of some steel products in November, Baosteel maintained a flat plate of cold and hot coils and the original preferential policies, which exceeded market expectations to a certain extent. From this, the industry guessed whether Baosteel would actively reduce production to maintain prices. For now, it is unclear whether production cuts and price protections will be effective, but controlling production capacity has become a top priority for the steel industry.

Historically, there have been very few initiatives to reduce production and protect prices due to falling prices. In 2005 and 2006, the industry had proposed to reduce production and insure the price, but it was nothing. All subsequent production cuts were passive production cuts due to industry fluctuations and policy restrictions. Baosteel's November price policy remained flat, showing to a certain extent that the company's order status is still operating normally. Under the circumstance of low sales pressure and normal contract carryover, the motivation to actively reduce production and insure prices is insufficient.

At present, the possibility of steel mills actively reducing production to support prices is very limited. In contrast, passive production reductions should arouse more vigilance. Although the current steel industry is under operating pressure, it will not reproduce the situation of large-scale production cuts during the financial crisis to save lives. The steel companies currently under greater pressure are mainly weak companies that are hovering near the cost line, have low added value of their products, and are not very competitive in the market. Although large steel mills have high product costs, they can support higher prices due to their technical content, thereby maintaining a certain profit margin. Therefore, whether it is to reduce production to protect the price or reduce production to save life, it is unlikely to appear on a large scale in the short term.

Although the pressure to cut production is limited, it does not mean that the steel industry can let its production capacity continue to grow. On the contrary, the control of production capacity requires steel mills to pay attention. Due to relatively strong demand, the national average daily output of crude steel in the first half of the year was 1,936,700 tons, of which the daily output level reached a new high in June. In the third quarter, as demand cooled, the average daily steel output also declined to a certain extent. In late September, the daily crude steel output of key iron and steel enterprises was 1.6397 million tons, and the national daily output is estimated to be 1,930,300 tons.

The slowdown in downstream demand is undoubtedly an important reason why steel mills need to control production capacity. The current economic environment at home and abroad is facing multiple pressures, coupled with the relatively tight domestic capital chain, which greatly affects market demand. As my country’s investment growth is mainly driven by investment in railways and social housing construction, and the current high-speed rail construction is stagnating, real estate investment is boosted by social housing, but it is also subject to pressure from the capital chain to decline. Therefore, the growth of fixed asset investment may be Will continue to slow down, and downstream demand in the steel industry will continue to decline.

While downstream demand is weak, upstream iron ore prices also put pressure on steel mills. It is worth noting that due to the adjustment of domestic and foreign markets, commodity prices have fallen, and the environment for falling iron ore prices in the fourth quarter has been formed. In addition, steel mills are facing operational difficulties and cannot afford higher ore prices, which will prompt iron ore prices to gradually enter the downward space. This will also ease the cost pressure faced by steel mills to a certain extent. Obviously, in the face of difficult times, domestic steel companies need to adjust production pace, optimize product structure, and control production scale as soon as possible. As the industry enters the winter, we will focus on enhancing the added value of products, our own competitiveness and profitability, and doing a good job of our company's internal strengths.