Can China Cool Steel Boom?
Beijing Puts Curbs on Mills and Exports,
But Local Governments Resist
SHANGHAI -- China, already the world's biggest steel producer, keeps getting bigger -- a trend that is worrying Beijing and the global industry.
As steel production expands and exports rise, the Chinese government is adopting measures to cool the hot sector. In April and May, the government abolished or cut export rebates given for certain steel products. This month, Beijing reduced the number of mills allowed to import iron ore, a vital raw material for steel making and one that has been rocketing in price. In the coming weeks, China is expected to unveil industry guidelines for its 800 steel companies, which are all scrambling for resources, energy and customers.
Beijing wants to curb steel investment to address a potential global oversupply -- domestic demand is slowing and steelmaking capacity is up around the world. New industry guidelines are expected to push for energy conservation, higher-end production and mergers among steelmakers. Behind these moves is an effort by Beijing to create genuine global players.
"China is at a crossing point," says Malcolm Southwood , a commodities analyst in Melbourne, Australia, for Goldman Sachs JBWere. "The government wants to step in and say, 'We don't need every locality producing steel.' "
There is resistance to Beijing's efforts to consolidate the domestic steel industry. Many of the smaller steel mills are scrambling to expand capacity in order to avoid a possible closure by Beijing, the logic being that if they get big they will be too big to close. Local governments are resisting pressure from the central government to curb production, and in fact they are helping to fund the increase in steel production. Local officials want to ensure jobs and economic growth.
A steel market in central China.
All these factors suggest that policy makers might have trouble preventing Chinese steel exports from undercutting global prices.
In the past, when China experienced a glut of inexpensive textiles and televisions, domestic manufacturers looked for markets overseas. A similar shift in steel could pose a bigger challenge to steelmakers, reversing fortunes for companies around the world that have been benefiting from prices increasing on Chinese demand.
Despite Beijing's moves, scores of new projects are barreling ahead; even some mills that were shut have recently reopened, steel analysts say. The buildup comes in spite of moves by local governments to temper real-estate construction, a big consumer of steel, and to tighten environmental codes because of worsening pollution.
The growth in capacity is casting a long shadow over the steel industry. China last year produced 296 million metric tons, accounting for about 24% of the world's total crude steel output. In a May 6 report, securities firm CLSA Asia-Pacific Markets warned that "an overshooting of steel capacity" in China may be inevitable -- and by a margin that could exceed demand of entire markets, such as South Korea. "The sheer magnitude of China is enough to overwhelm," it says.
For now, many analysts say domestic demand -- combined with a strong government hand -- will help cap Chinese exports and support global prices. China's railways are spending billions of dollars to expand, the ship-building industry is booming and auto sales, while significantly slower than previous years, are starting to pick up again.
As capacity expands, some excess supply from China is showing up overseas. In March, China was a net exporter of finished and semifinished steel for a seventh consecutive month, according to data by Steel Business Briefing, a London information service for the industry.
Before September 2004, China had never been a net exporter of steel, according to Melinda Moore, head of Steel Business Briefing in Shanghai. "Chinese companies are producing and exporting higher-end product," she says.
Contributing to the outflow are midsize companies such as unlisted Shiheng Special Steel. The company, based in the northeastern province of Shandong, this year expects to export 200,000 metric tons of steel products, mostly to Asian countries, compared with 160,000 metric tons last year. (A metric ton is equal to 2,204.62 pounds.) "Prices are better overseas," says Fang Zeshan, head of foreign trade for Shiheng Special Steel.
Meanwhile, Chinese steelmakers are investing an estimated $30 billion to add capacity. Shanghai Baosteel Group Corp., the parent of Baoshan Iron & Steel, has a unit in the southern province of Guangdong that wants to lift capacity 33% to 40 million metric tons. The planned expansion is awaiting government approval, says a Baosteel executive.
Shiheng Special's parent, Jinan Steel Group, plans to expand its capacity to 10 million metric tons this year from 6.9 million metric tons in 2004. The company had a slightly lower target before an inspection by a senior provincial official, according to Wang Xiutang, the company's marketing information manager. "We were encouraged to change our plan, so we're increasing capacity," he says.
中国能成功为钢铁业降温吗？
中国已经是世界最大的钢铁生产国，但它的钢铁产量还在增加，这种发展趋势使中国政府和全球钢铁业感到担忧。
随著钢铁生产能力的扩张和钢铁出口的增长，中国政府正采取措施来为过热的钢铁行业降温。在4月份和5月份，政府取消或削减了针对某些钢铁产品的出口退税。本月早些时候，中国政府减少了获准进口铁矿石的钢铁厂数量，铁矿石是钢铁生产的重要原材料，其价格一直在直线上扬。未来几周内，中国预计将公布用于指导国内800家钢铁厂的产业政策，这些企业都在急切地寻求原料、能源和客户。
Goldman Sachs JBWere驻墨尔本的大宗商品分析师马尔科姆?桑斯伍德(Malcolm Southwood)说，中国正处在一个十字路口，政府想出面干预说，不需要每个地方都生产钢铁。
中国政府的行动在地方上遇到了阻力，这表明政府在阻止中国钢铁出口商压低全球钢铁价格方面可能会有困难。以往，当中国廉价纺织品和电视机的生产出现过剩时，国内生产商就将目光转向了海外市场。如果中国的钢铁生产商也瞄准海外市场，那么产生的影响还会更大，将使全球其他国家的钢铁生产商好运不再。受中国需求的推动，世界钢铁产品价格一直在不断上涨，这使全球钢铁生产商受益匪浅。
中国政府整合国内钢铁产业的举措将对中国一些钢铁生产商有利。海通证券(Haitong Securities)驻上海的钢铁业分析师雍志强说，宝山钢铁股份有限公司(Baoshan Iron & Steel Co. Ltd., 简称：宝钢股份)和鞍钢新轧钢股份有限公司(Angang New Steel Co., 简称：鞍钢新轧钢)等中国最大的钢铁企业就属于这类受益者，这两家分别在上海和香港上市的企业凭借其中高端钢铁产品、实现了销售收入的高速增长。
但雍志强警告说，钢铁类股的价格上涨空间可能有限。这是因为中国政府正准备在国内股市上出售价值数十亿美元的国有股。此举会对整个中国股市产生影响，中国股市目前已经跌至了6年低点。
其他分析师则认为，在中国钢铁行业完成整合之前，须对持有中国钢铁类股持谨慎态度。Goldman Sachs JBWere的桑斯伍德说，最好还是关注那些只是向中国钢铁生产商提供原材料的企业，如铁矿石生产商必和必拓(BHP Billiton)和Rio Tinto。
钢铁业分析师们说，尽管中国政府采取了限制措施，但新开工的钢铁项目仍然层出不穷，甚至一些已经被关闭了的小钢铁厂最近也重新开工了。虽然各地政府已在采取措施为房地产开发降温，并且由于污染加重的原因而加强了环境法规的执法力度，但各地的钢铁产能仍在扩大。
钢铁产能的增长成为笼罩在中国钢铁业头上的一块浓重阴云。中国去年的粗钢产量达到2.96亿□，约占全世界总产量的24%。证券公司CLSA Asia-Pacific Markets在5月6日的一份报告中警告说，中国的钢铁产能可能将不可避免地出现过剩，过剩量有可能超过韩国全国的钢铁需求。该公司说，中国庞大的钢铁生产规模足以使其他国家的钢铁生产商遭受灭顶之灾。
中国钢铁生产过剩已经影响到了海外市场。伦敦钢铁行业通讯《Steel Business Briefing》援引中国海关的最新数据称，今年3月，中国已连续7个月成为成品钢和半成品钢的□出口国。
而据《Steel Business Briefing》的上海负责人梅林达?摩尔(Melinda Moore)说，在2004年9月份之前，中国从未成为过钢铁产品□出口国。她说，中国企业正在生产和出口中高端产品。
石横特钢(Shiheng Special Steel)等中型企业也加入了钢铁出口大潮。这家山东的非上市企业今年预计将出口20万吨钢，主要出口到亚洲国家，该公司去年的出口量为16万吨。石横特钢外经处处长房泽山说，国外的钢铁产品价格要高于国内。
与此同时，中国各钢铁生产商正在投资约300亿美元以扩大产能。宝钢股份的母公司上海宝钢集团公司(Shanghai Baosteel Group Corp.)已在中国南方的广东省设立了一家子公司，希望以此将公司的钢铁产能提高33%，达到4,000万吨。宝钢的管理人士说，这一产能扩张计划正在等待政府的批准。
石横特钢的母公司济南钢铁集团(Jinan Steel Group)计划将钢铁产能从2004年的690万吨提高到今年的1,000万吨。济南钢铁集团的市场信息部负责人王秀堂说，该公司原来的增产目标定得较低，但一位省领导视察公司时鼓励他们修改原有的计划，所以该公司决定进一步扩大产能。
许多分析师目前依然相信，强劲的国内需求再加上政府的强力干预将使中国的钢铁出口量降下来，从而使全球钢铁产品价格继续维持在高位。中国的铁路部门正在斥资数十亿美元扩建路网，中国的造船业正在蓬勃发展，中国汽车销售量的增长率虽然大大低于前几年，不过终于又开始提高了。此外，尽管中国的钢铁工业最近取得了长足的进步，但轿车用钢等高端产品的国内产量依然不足。
近几周来，中国的政策制定者一直在加紧呼吁控制钢铁业的投资。新的产业指导政策预计将鼓励节能、高端产品生产以及钢铁生产企业间的合并。中国政府这些举措的背后动机是打造几家具有全球竞争力的钢铁企业。
中国的钢铁行业中不乏巨无霸型的企业，要把它们整合在一起并非易事。一些大型钢铁企业是计划经济的产物，它们曾经向员工提供教育和医疗服务，部分企业目前仍延续著这种服务，而许多企业则需向日益增加的退休员工支付养老金。中国的一些钢铁生产商更像是政府机构而非依据市场原则经营的企业，这也使涉及它们的合并交易变得复杂。
中国两大钢铁公司鞍山钢铁集团(Anshan Iron and Steel Group)和本溪钢铁集团(Benxi Steel Group)的合并工作已经搁浅，主要原因是无法就处理两公司的债务达成一致。
