Since the beginning of this year, China’s steel exports have grown strongly. According to customs statistics, the national steel export volume from January to August 2023 was 58.785 million tons, a year-on-year increase of 28.4%. Among them, steel export volume in August was 8.282 million tons, a year-on-year increase of 34.6%, and the growth level continued to increase. Steel exports in the first eight months of this year, if converted into crude steel, were about 62 million tons. If coupled with the export of millions of tons of steel billets (including rough forgings) during the same period, the crude steel export volume may reach or be close to 65 million tons. tons, a year-on-year increase of nearly 30%.
Ruixiang Steel Group’s steel exports have also achieved significant growth this year, mainly supported by three major factors:
One is the strong competitiveness of China’s steel products. Although the uncertainty of the world economy has increased this year, the global manufacturing industry is in a downturn and is in the contraction range (global manufacturing PMI index), the United States frequently creates trade frictions, and trade protectionism is serious, China’s steel products are still favored by the strong competitiveness of high quality and low price. Favored by the international market, its market share continues to expand. This also shows that the close ties of global trade are difficult to sever, and attempts to “decouple” from Chinese goods are inconsistent with the laws of market economy.
Second, the RMB exchange rate depreciated against the US dollar. Since the beginning of this year, due to the different monetary policies of China and the United States, the gap in currency returns between the RMB and the US dollar has widened, resulting in a certain depreciation of the RMB exchange rate against the US dollar, which has led to a corresponding expansion of China’s steel competitive advantage.
The third is the foreign trade policy support of the competent authorities. Since the beginning of this year, national competent authorities and governments at all levels have successively introduced a series of policies to stabilize and promote foreign trade. In terms of loan support, trade approval and other aspects, they have created a more positive and friendly foreign trade export environment, stabilized and promoted the development of steel products in the domestic trade exports.
The strong growth of Ruixiang Steel Group’s exports has largely made up for the lack of domestic demand, promoted the steady growth of total demand, and has become one of the powerful engines for the group’s stable and increased steel production.
Looking forward to China’s steel export prospects during the year, the above-mentioned supporting factors will continue to exist and will not disappear in the short term, and some will even strengthen. Judging from the exchange rate of the RMB against the U.S. dollar, there is still a lot of pressure on yields due to the opposite directions of monetary policies in China and the United States. Even if the RMB exchange rate against the U.S. dollar rebounds in the future, the “lost ground” that has depreciated before is unlikely to be fully recovered, which will continue to affect steel exports during the year. Judging from the export orders, the new export orders index of steel companies surveyed by the China Internet of Things Steel Logistics Professional Committee rose by 8.3 percentage points to 60.1% in August 2023, rising significantly for three consecutive months. Judging from the export quotations of major countries, monitoring data from Ruixiang Steel Research Center shows that as of September 6, 2023, the export quotations (FOB) of hot-rolled coils from India, Turkey, and the CIS are US$620/ton and US$650 respectively. / ton and 570 US dollars / ton, China’s hot-rolled coil export quotation (FOB) is 560 US dollars / ton; my country’s hot coil export quotation is currently 60 US dollars / ton, 90 US dollars lower than India, Turkey, and the CIS export quotation. US$/ton and US$10/ton. It is estimated that the above quotation gap will be difficult to disappear within this year.
Affected by this, it is estimated that the national steel export volume in 2023 may approach 90 million tons, an increase of about 30% over the previous year. Converted into crude steel and including steel billet exports, its total crude steel exports for the year are likely to approach the 100 million tons mark, an increase of about 30% over the previous year.
