Since the outbreak of covid-19, the steel industry all over the world has been affected to a different extent. For China, domestic demand has been sluggish and the steel export is also under pressure due to the low demand abroad. From the beginning of March, the foreign purchasers have asked Chinese mills to defer the delivery of the cargo or even canceled the orders which makes factories are under high inventory pressure.
From the Q1 operation data, we have seen that the steel industry is capable of dealing with such challenges at present while we also should notice the large stockpiles pressure due to contradiction between the stage capacity release and actual weak consumption recovery.
Under such pressure of high stock, the steel industry should make investment decisions scientifically and avoid behaviors like enlarging steel capacity to lower the risks of heavy overcapacity.