China Iron and Steel Association (CISA) predicts exports of steel products are likely to decline in Q1 (Jan-Mar 2020) from the prior-year period. Though Chinese producers had secured orders before the beginning of spring festival, uncertainties in dispatching shipments could impact exports.
The association assessed the impact of the coronavirus outbreak on the steel industry. According to their assessment, the steel price index fell by 3.31 points to 100.55points in the third week of Feb 2020 compared to the prior-year period. The index has declined by 1.40 from the previous month and by 3.31 points from before the beginning of spring festival on Jan 24.
Though the daily output of crude steel in early February rose by 3.16pc to 19.39mn mt, it dropped by 2.68pc from January since companies reduced production amid the coronavirus outbreak.
Inventories in the steel inventories are high as projects in the country came to standstill to control the virus outbreak. This has caused a shortage of funds in the steel industry and the assets liability ratio of steel companies presently is 63.16pc, a drop by 1.34pc from the prior year.