[SMM Steel Market Morning News] Expert: Larger-Scale Government Bonds Planned for 2025, Special Actions to Boost Consumption Will Also Be Implemented

★ Macro ★ 01 ★★ 【Expert: Larger-Scale Government Bonds Planned for 2025 Along With Special Actions to Boost Consumption】 Yang Zhiyong, President of the Chinese Academy of Fiscal Sciences, stated that based on the economic outlook for 2025, with increasing external uncertainties and the need to better address domestic economic challenges, extraordinary counter-cyclical adjustments are required to achieve stable economic growth. Such adjustments include stronger policy measures, such as a fiscal deficit ratio exceeding 3% and the issuance of larger-scale government bonds, which are unprecedented arrangements. Additionally, in the face of various uncertainties, contingency plans should be prepared to enhance the foresight, precision, and effectiveness of macroeconomic regulation, thereby better guiding market expectations. China still has significant macro policy space and a foundation for extraordinary counter-cyclical adjustments. In 2025, special actions to boost consumption will also be implemented. Larger-scale ultra-long-term special treasury funds will support the program of large-scale equipment upgrades and consumer goods trade-ins, better facilitating trade-ins for consumer goods. Fiscal efforts will also focus on expanding service consumption and promoting cultural and tourism consumption. 02 ★★ 【Preview: State Council Information Office to Hold "China's High-Quality Economic Development Achievements" Press Conference (Ministry of Water Resources) on December 31】 The State Council Information Office will hold a press conference on "China's High-Quality Economic Development Achievements" at 10:00 a.m. on Tuesday, December 31, 2024. Vice Minister of Water Resources Chen Min will introduce relevant information on "Promoting High-Quality Development in Water Resources and Ensuring China's Water Security" and answer questions from the press. ★ Industry and Downstream ★ 01 ★★ 【Institution: Last Week's Second-Hand Housing Transactions in 20 Cities Up 2.1% WoW】 The China Index Academy released a statistical report showing that in the 52nd week of 2024 (December 22-28), 35,527 second-hand housing units were transacted in the 20 cities it monitored, up 2.1% WoW and up 103.4% YoY. In first-tier cities, 13,276 units were transacted, up 0.9% WoW and up 119.8% YoY. Among them, Shenzhen's second-hand housing transactions fell 6.7% WoW but rose 437.0% YoY, leading first-tier cities in YoY growth. In representative second-tier cities, 19,214 units were transacted, up 6.5% WoW and up 109.4% YoY, with Nanning's transactions in the 52nd week more than doubling both MoM and YoY. In representative third- and fourth-tier cities, 3,037 units were transacted, down 15.1% WoW but up 35.3% YoY. 02 ★★ 【"Year-End Effect" Evident as Beijing Offers Another Land Parcel Without Price Cap】 Beijing successfully auctioned a land parcel in Dong'erqi Village, Beiqijia Town, Changping District, with a transaction amount of 2.1143 billion yuan and a floor price of 21,100 yuan/m². Notably, this is the second land parcel without a price cap offered in Beijing in 2024. As the year-end approaches, many regions are experiencing a small peak in land auctions, with the "year-end effect" becoming evident. Many real estate companies are making year-end land acquisitions, drawing market attention. On December 26, Wuhan successfully auctioned 30 land parcels, with a total transaction amount of 21.094 billion yuan and a planned construction area of 3.9513 million m², marking the largest land auction in terms of area and amount in Wuhan in 2024. 03 ★★ 【Vietnam Launches Sunset Review of Anti-Dumping Measures on Cold-Rolled Carbon Steel Sheets from China】 According to the China Trade Remedy Information Network, on December 27, the Vietnamese Ministry of Industry and Trade issued Announcement No. 3565/QD-BCT, signed on December 25, 2024, to launch the first sunset review of anti-dumping measures on cold-rolled carbon steel sheets originating from China with a width of less than 1,600 mm and a thickness of 0.108 mm to 2.55 mm. The Vietnamese tariff codes involved are 7209.16.10, 7209.16.90, 7209.17.10, 7209.17.90, 7209.18.91, 7209.18.99, 7209.26.10, 7209.26.90, 7209.27.10, 7209.27.90, 7209.28.10, 7209.28.90, 7209.90.90, 7211.23.20, 7211.23.30, 7211.23.90, 7211.29.20, 7211.29.30, 7211.29.90, and 7225.50.90. Interested parties must register for participation within 60 working days from the date of initiation, with the deadline being March 19, 2025. 04 ★★ 【China Mining Association: Coal Production Expected to Reach 4.76 Billion mt This Year】 According to the China Mining Association, China's development of key mineral resources reached new highs in 2024. Secretary General Che Changbo stated that coal production continued to grow this year, with cumulative production from January to November reaching 4.322 billion mt, up 1.2% YoY, and the full-year production is expected to reach 4.76 billion mt. From January to November, crude oil production totaled 195 million mt, up 1.9% YoY, and is expected to reach 212 million mt for the full year. Natural gas production has increased by over 10 billion m³ annually for eight consecutive years, with cumulative production from January to November reaching 224.56 billion m³, up 6.4% YoY, and the full-year production is expected to reach 245 billion m³. Additionally, cumulative production of 10 non-ferrous metals from January to November reached 72.288 million mt, up 4.4% YoY, and is expected to reach 78.8 million mt for the full year. ★ Other Hot Topics ★ ⭕ 【Hangzhou Plans 1,148 Major Projects for the 15th Five-Year Plan Period With Total Investment Exceeding 2 Trillion Yuan】 Lou Jianzhong, Director of the Hangzhou Development and Reform Commission, stated at a press conference on December 30 that Hangzhou has initially planned 1,148 major projects for the 15th Five-Year Plan period, with total investment exceeding 2 trillion yuan. For example, focusing on building an international comprehensive transportation hub city, Hangzhou has planned 22 reserve projects with total investment exceeding 500 billion yuan, and plans to invest 164.6 billion yuan during the 15th Five-Year Plan period. Key projects include the high-speed rail airport line, Huzha-Hangzhou Railway, Jinqian Railway Jiande Section realignment, Metro Phase IV, and Airport Phase IV expansion, aiming to further improve railway layout, enhance urban rail transit density, and upgrade aviation hub capacity. Hangzhou will also prioritize projects oriented toward common prosperity and new quality productivity, aiming to pioneer new tracks in future industries and gradually optimize the investment structure. For instance, projects include the Zhijiang Laboratory National AI Industry Application Base (AI+Science), Hikvision Robotics Product Industrialisation Base, Jiande Aviation Town, and the Eastern Bay New City Renewable Energy Regional Centralized Energy Supply Center. ⭕ 【Ansteel Group Lingyuan Iron and Steel Group Co., Ltd. Officially Established】 Ansteel Group Lingyuan Iron and Steel Group Co., Ltd. was officially established on December 29, marking Lingyuan Steel's integration into Ansteel Group and the early completion of Ansteel Group's "14th Five-Year Plan" strategic restructuring goals. With Ansteel Group's acquisition of Lingyuan Steel, its crude steel capacity will reach 70 million mt, accounting for 67% of Liaoning Province's and 51% of north-east China's crude steel production, increasing the industrial concentration of the top 10 steel enterprises in China to 42%. ⭕ 【Ministry of Finance: 100% NEV Procurement for Fixed-Route Government Vehicles Primarily Operating in Urban Areas】 The Ministry of Finance issued a notice clarifying the NEV procurement ratio for government purchases. It stated that budget management units should determine the annual NEV procurement ratio for their departments (including affiliated budget units). For vehicles where NEVs can meet actual usage needs, NEVs should account for no less than 30% of the total annual government vehicle procurement. For fixed-route vehicles with single-use scenarios, such as confidential communication vehicles primarily operating in urban areas, 100% NEV procurement is required. For vehicle leasing services, priority should be given to leasing NEVs. ⭕ 【China Securities: Market Expected to Continue Fluctuating Upward in Early Next Year】 A research report by China Securities noted that in recent months, the A-share market's bottom has been steadily rising. In the short term, due to seasonal patterns, year-end profit-taking and risk aversion often lead to subdued trading, but activity typically picks up at the start of the new year. Liquidity is expected to improve further after the Chinese New Year. Under the current policy stance, RRR cuts and interest rate cuts are likely in Q1 next year, which would enhance the attractiveness of stock valuations as bond yields decline. Incremental liquidity is expected to drive a cross-year rally in the A-share market, with the market likely to continue fluctuating upward in early next year. The report recommends focusing on sectors benefiting from potential policy support, with AI+ as a mid-term industrial theme. Key sectors to watch include non-bank finance, electronics, military, media, machinery, real estate, construction, and leisure services. Key themes include AI+, low-altitude economy, and first-launch economy. ⭕ 【Colombia Issues Final Ruling on Anti-Dumping Sunset Review of Steel Strand from China】 The Colombian Ministry of Commerce, Industry, and Tourism announced a final ruling on the anti-dumping sunset review of steel strand originating from China. It decided to adjust the anti-dumping measures determined in Announcement No. 259 of November 16, 2018, from a 15% ad valorem duty based on FOB prices to a minimum price-based anti-dumping measure. If the FOB price of the product in question is below the minimum price of $3.36/kg, the difference will be subject to anti-dumping duties.