The rising cost of raw materials has caused the steel industry to decline

According to data released by the China Iron and Steel Association on the 29th in July , the national crude steel output was 2,749,100 tons, down 5.78% from the previous month . The growth rate of steel production dropped significantly , and the price of steel was relatively stable. However , due to teh high cost of raw materials , the profitability of steel enterprises declined.

From January to July , the sales staff of Chian Steel Association achieved sales income of 2.43 trillion Yuan, an increase of 9.75% year-on-year , but the cost of sales increased by 14.4% year-on-year . The total profit reached 123.582 billion yuan, down 23.93% year-on-year. The semi-annual report of listed companies recently released also shows that most steel companies have experienced a decline in performance.

According to the relevant person in charge of the China Steel Association , the sharp decline in earnings was mainly due to the increase in raw material prices. from January to July , the cost of domestic iron ore procurement increased by 19.88% year-on-year , imported ore rose by 29.13% , and scrap increased by 10.03%.

It is worth nothing that although the price of imported iron ore continued to rise sharply , in july , China imported 91.01 million tons of iropn ore , an increase of 15.83 million tons , an increase of 21.06%. At the end of July , the inventory of imported iron ore ports increased to 11642 . Ten thousand tons .

As the world's largest steel producer and steel consumer market , China is also the world's largest importer of iron ore . However , due to the high concentration of steel enterprises , steel companies have been in a weak position.

In this regard , China Steel Association believes that the current pricing mechanism has defects in maintaining the belanced development of the interests of the industrial chain , which is not conducive to the long-term mutual benefit and win-win situation of upstream and downstream industries , and needs to be further improved. In addition, whether there are non-supply factors in the pricing mechanism is worthy of attention.

"Recently , the Sino-US trade frictions provoked by the United States have escalated , and the impact on the global economy is stioll emerging . However , China have also adopted a series of measures to expand consumption and stabilize growth . Steel demand is expected to remain stable . Steel companies must maintain Force , further ration control of prtoduction rhythm and maintain market stability." The relevant person in charge of China Steel Association said .

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