The contradiction between the downstream demand for hydraulic props and the continued sluggish supply is still very sharp.
July 25 04:01:06, 2025
The gap between the steady demand for hydraulic props and the ongoing weak supply remains significant. Furthermore, it's anticipated that other major steel producers, such as Angang, will likely follow in the footsteps of Baosteel and Wuhan Iron and Steel, with a high probability of further price reductions in September. As a result, we don’t expect a sharp upward trend in domestic steel prices during the "Golden September and Silver October" period.
Since the start of this year, global economic growth has remained weak, and domestic economic indicators have not shown much improvement. The demand for hydraulic props continues to be sluggish, while daily crude steel production remains high. Since mid-April, the domestic steel market has experienced a sharp decline, with prices of major steel products falling below levels seen in 2010. This marks a three-year low, and there’s still no clear sign of stabilization. Although the current market lows are not yet as severe as those during the 2008 financial crisis, market panic is intensifying, and the risk of a repeat of the financial crisis is becoming more apparent.
So, could domestic steel and raw material prices hit a level similar to 2008-2009? This article aims to provide a comparative analysis for reference only.
Although steel mills have taken steps to reduce output, the scale of these cuts remains minimal. According to a survey by Lang Steel, the number of blast furnaces that were shut down in August did increase. However, the average daily production drop equates to a total reduction of just over 500,000 tons, which is not enough to address the issue of oversupply. The imbalance between supply and demand remains acute, and the market is still under significant downward pressure.