On the morning of May 16, 2023, the "2023 North China Black Metal Industry Summit Forum - Pipe Coil Sub Forum" was grandly held at the New Hualian Pullman Hotel in Tangshan! Liu Kaisong, Deputy General Manager of Tianjin Yuantai Derun Group, was invited to attend.
At the beginning of the meeting, Hou Liyan, a strip steel analyst from Shanghai Iron and Steel Union, and Zheng Dong, a steel pipe analyst, delivered keynote speeches on "2023 Hot Rolled Strip Steel Operation Status and Future Market Outlook" and "2023 National Welded Pipe Market Review and Outlook". They reviewed the market for hot rolled strip steel, welded pipe, and galvanized pipe in China in 2023, showing strong supply and weak demand, with peak season expectations falling short, and insufficient release of steel pipe demand; Looking ahead to the strip steel market in the second half of 2023, Hou Liyan stated that it is still difficult to significantly alleviate the short-term supply and demand contradiction. Dai Zhengdong stated that the supply and demand fundamentals of welded pipes may continue to maintain a weak balance, and the annual production capacity utilization level will continue to decline, indicating a mild decline in overall consumption. However, with the continuous increase of domestic countercyclical adjustment policies, the bottom of steel prices is expected to appear in the near future after experiencing continuous significant adjustments. Starting from the third quarter, the main logic will gradually return to industrial fundamentals. In the second half of 2023, the domestic steel pipe market may show a narrow range of fluctuations, with limited overall growth.
Next, Liu Kaisong, deputy general manager of Tianjin Yuantai Derun Steel Pipe Manufacturing Group Co., Ltd. will share the theme of "Remanufacturing, Reintegrating Channels, and Reserving Terminals". The industry with slowing demand should Develop Better with High Quality. First, Mr. Liu introduced the development history, advantages, and core of Tianjin Yuantai Derun Group, which was founded in 2002. Now has two production bases in Tianjin and Tangshan, has been focusing on square and rectangular steel pipe-based structural steel pipe research and development, production, sales, and service for more than 20 years. Mr. Liu said that in the past long period of time, the economic level of our country was developing rapidly, and the competitive pressure of the industry was not particularly great. The overall market was a seller's market with greater demand than supply, but the development in the past two years gradually changed into a period of demand determining the market, which also forced enterprises to transform and upgrade to adapt to the changing market. And the competition between enterprises will be the main melody of the market in the future. In the face of this pattern, the most important thing for enterprises is to reduce costs and increase efficiency. We will achieve industrial synergy in production, channels, and terminals to help enterprises develop in a high-quality and healthy way. Finally, Mr. Liu suggested that all enterprises should conform to the direction of national emerging industries and firmly pursue the road of high-quality development through scientific and technological innovation.
After the theme sharing, Mr. Liu put forward his own views from the perspective of his own enterprise on issues such as "How to operate the current inventory in the later stage? What are the means to avoid risks?" "Is there an improvement in downstream consumption trends and funds in the current economic situation?". The current level of inventory in the factory is relatively high, and in order to ensure relatively complete specifications, it is not willing to actively reduce production as a last resort. For risk avoidance operations, one is to increase the level of order volume, and the other is to use financial instruments to perform cash hedging. In addition, we currently maintain a 1:1 ratio of orders to inventory for risk hedging. Regarding the downstream demand side, Mr. Liu expressed his pessimism towards the second half of the year, as new growth points such as photovoltaic brackets and solar houses are currently in the growth stage, but the amount of growth is limited. However, the increment on the supply side is relatively significant. Moreover, downstream funds are currently in a relatively tight state. The turnaround in the second half of the year, in terms of square management, may be due to the country's relatively large infrastructure investment, and there may be significant growth in the northwest region and offshore photovoltaics. Overall, I am not very optimistic about the second half of the year, and I hope to continue reducing costs and increasing efficiency, and passing it smoothly.
Post time: May-22-2023