December PMI of Domestic Steel Dropped to 50.2%

    According to the index report released by China Iron and Steel Logistics Committee on December 31, 2017, the PMI for the domestic steel industry in December 2017 was 50.2%, down 2.9 ppts from the previous month and above 50% for the eighth consecutive month Expansion interval.

    According to the analysis, except for the obvious rise in the inventories of finished products, the other indexes all showed a decline. Among them, the production index fell slightly and was in a contraction zone for two consecutive months. While the new orders index dropped significantly, For eight consecutive months in the expansion range; new export orders index also dropped significantly for 13 consecutive months in the contraction range. These data show that in December 2017, the iron and steel industry, the supply slowed down, the demand accelerated, business inventories began to accumulate, the characteristics of the market show off-season.

    Steel production is still slightly reduced. In December 2017, the steel industry production index was 46.1%, down 0.4 percentage points qoq and continued to contract. The reason for the reduction is mainly that the policy of winter limited production in winter strictly implemented in the north has a direct impact on the production of steel enterprises. At the same time, cities such as Anhui and Jiangsu have also stepped up efforts to limit the production of environmental protection and have also exerted some influence on the production of the steel enterprises. Procurement related to production also showed a significant slowdown, but remained above 50% of the expansion.