SHANGHAI, Jun 7 (SMM) — This is a roundup of news in the steel industry for last week.
China to stabilise pricing and supply of commodities and promote import diversification
China's Ministry of Commerce will continue to stabilise the pricing and supply of commodities, as well as actively promote import diversification, strengthen international cooperation and build mutually beneficial trading channels. At the same time, China will also strengthen departmental collaboration, ensure transport capacity and reinforce freight rate supervision. It was reported that China companies have been facing difficulties and challenges such as rising raw material prices, large exchange rate fluctuations, and poor shipping logistics.
China to empower market players, as well as oppose monopoly and unfair competition
China's Premier Li Keqiang said on a recent tele-conference to promote the reform of "delegation, regulation and service" to further empower market entities, reduce improper intervention, strengthen fair supervision, improve fair competition, and optimise public services. The government will also encourage new business start-ups and encourage citizens to innovate and develop their potentials. In addition, the administrative examination and approval system must be simplified to make market entry and exit more convenient and promote market metabolism. Market supervision should be innovated and improved to crack down on monopoly and unfair competition, as well as protect the legal rights and room for development for market entities, especially for SMEs and individual businesses.
China to further stabilise land and housing prices
China's first plenary meeting of promoting the integrated development of the Yangtze River Delta was held in Beijing on June 1. Vice premier Han Zheng emphasised the need to improve infrastructure interconnection, coordinate the construction of an integrated comprehensive transportation system, improve the high-quality development of pilot free trade zones, accelerate the improvement of scientific and technological innovation capabilities, and enhance the innovation of enterprises. China will also reinforce the joint protection of the ecological environment and rectify the pollution problems. Specific policies will be implemented to stabilise land and house prices.
MIIT to monitor the increment of raw material prices
China's Ministry of Industry and Information Technology (MIIT) will strengthen operational monitoring, stabilise market expectations, and respond to the impact of rising raw material prices on SMEs. It was mentioned at a regular policy briefing of the State Council on June 1 that the sharp increase in raw material prices this year has put pressure on small and medium-sized enterprises.
Zhongwei, Ningxia to limit the production of high energy consuming enterprises
The city of Zhongwei in Ningxia has proposed to impose production restrictions on some high-energy-consuming enterprises, in order to effectively curb the rapid increase in energy consumption. All newly-built projects consuming large quantities of energy and resources should not be put into operation within the year after completion. The producers should reduce output by 30% in June by lowering operating load and suspending RKEFs. The enterprises will cut down production by another 30% during July to December according to the actual energy consumption and annual targets.
Real estate financing plummeted by nearly 30% in May
The overall financing scale of real estate companies is shrinking under the tightened policies (“Three Red Lines” policy), and many real estate companies are seeking off-balance-sheet financing, which has also attracted the attention of regulators. According to the monitoring data of the Tongce Research Institute, 40 of the listed real estate companies completed a total of 44.09 billion yuan in financing as of May 2021, a 28.48% month-on-month decrease and a year-on-year decrease of 27.4%. In the current financing environment, it is difficult to make profits, and even more difficult to obtain low-cost funding, and capital chain of developers will remain tight.
