China's steel enterprises' profit forecasted to improve in Apr
In March 2024, the steel industry witnessed a significant shift in inventory cycle costs as raw material prices fluctuated. Downstream demand struggled to recover, leading to restricted steel mills' production enthusiasm. While steel companies expect phased profit improvements in April, global manufacturing indicators suggest a potential rebound, easing pressure on the global economy. In China, macroeconomic policies and gradual economic recovery efforts are anticipated to bolster the domestic economy.
However, challenges persist on the supply side, with limited terminal demand release and construction project delays affecting steel production. Regulatory bodies are closely monitoring steel output to align with energy conservation and carbon reduction goals, reflecting a deep adjustment period for China's steel industry.
Although an anticipated recovery in construction steel demand due to the government's stimulated policies, weak real estate investment and infrastructure project limitations pose challenges. Nevertheless, resilience in manufacturing industries like automobiles and home appliances is expected to sustain steel demand. Driven by the low level of raw material prices, steel production costs have notably decreased, contributing to forecasted phased profit improvements.
