Steel prices improved in the first half of 2013

Recently, several listed steel companies successively issued 2013 half-year performance forecasts. According to the analysis, the sharp drop in raw material prices and the increase in capacity utilization in the first half of the year have led to an increase in the profitability of steel companies, and the industry has shown signs of reducing losses.

As of July 14th, 17 of the 34 iron and steel companies have announced 2013 performance forecast for the first half of the year: 4 forecasts have slightly increased, 3 have turned losses, 3 have been reduced, 1 is the first loss, and 6 are continuing losses. Compared with the same period of last year, the industry showed a slowdown in losses.

Among them, Anshan Iron and Steel Co., Ltd. recorded a profit of 702 million yuan in the first half of the year, compared with a loss of 1.976 billion yuan in the same period of last year. The company turned losses into profits; Shougang Group expects its net profit loss for the first half of the year to be 250 million yuan to 300 million yuan, a 15% to 28% year-on-year decrease. The earlier forecasted net loss of Valin Steel exceeded 373 million yuan, a decrease of approximately 70% year-on-year.

In the half-year forecast issued by Angang Steel, the company's profit for the first half of the year was 702 million yuan, a loss of 1.976 billion yuan in the same period last year, and the company turned losses into profits. Earlier, Angang earned a profit of 540 million yuan in the first quarter. Based on this calculation, the company achieved a net profit attributable to the parent company of 162 million yuan in the second quarter, continuing to lose money year-on-year, and a slight decrease from the previous quarter.

The company’s report stated that in the first half of the year, a series of measures such as market research, control of raw material procurement rhythm, optimization of production and management structure, and effective reduction of production and operation costs were the main reasons for the company’s turning losses.

In addition, in the semi-annual forecast released by Shougang Co., the company’s net profit loss was between 250 million and 300 million yuan, a year-on-year decrease of 15% to 28% compared to a net loss of nearly 350 million yuan in the same period last year; The net loss of steel was over 373 million yuan, a year-on-year drop of about 70%.

Analysts believe that in the first half of the year, the iron ore price of steel raw materials fell sharply, causing the mill's gross profit to recover, resulting in the expansion of corporate profits and allowing steel mills to make a profitable turn. “The Platts index for imported iron ore was 160 in February this year. It fell to 109.75 in May, and the raw material fell more than steel prices, making steel mills facing continuous losses have a profitable turn.”

According to data from the China Iron and Steel Association, from January to May this year, large and medium-sized iron and steel enterprises across the country achieved a sales income of 1.49 trillion yuan, an increase of 0.74% year-on-year, and a profit of 2.837 billion yuan, a year-on-year increase of 33.99%.