Building materials prices fell to a record low Building materials market stitches to live

China Paint Network
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on the topic of deflation, the Chinese industry discussions as early as 2012 began, the discussion that China is entering a cycle of increasing deflation, for two reasons, one is China's traditional industrial structure under the serious overcapacity led to slow economic growth, and the other is the bear market of commodities, especially the fall in international crude oil prices led to China's industrial prices depressed.
situation, building materials-related industries to increase domestic and foreign competition has begun to emerge. Some macro analysts believe that the continued introduction of domestic easing policy is a high probability event, under the influence of China's real estate investment growth rebounded, this time around the second quarter, when China's economy is likely to emerge from deflation.
China's economy is in disarray
data released by the National Bureau of Statistics on January 9th showed that PPI fell 3.3% year-on-year in December 2014, continuing to be negative for 34 consecutive months and recording the biggest decline since September 2012; CPI rose 1.5 per cent year-on-year, up slightly from November, but still running below 2 per cent for the fourth month in a row.Yan Yang, a macro interest rate researcher at
China Investment China Valley Futures, said that the rising dollar index continued to depress commodity prices, the CRB Spot Composite Index has fallen by 3% since the beginning of the year, international crude oil prices are still falling after entering the new year, NYMEX crude oil futures prices have fallen 15.7% since January.
" affected by this, domestic refined oil prices for the first time to achieve 13 consecutive declines, non-food prices will be dragged down. Taking into account the Misality of the Spring Festival, cpi is expected to fall to around 1% yoY in January. The purchase price index fell to 39.9 from 43.1 in December and the factory price index fell to 43.9 from 44.9 in December, according to hsbc's manufacturing PMI for January 2015. Yu Yang said.
in the deflationary environment, the price of building materials closely related to real estate is the most market concern, such asset prices are an important weather marker for The interpretation of China's deflation situation, so the real estate situation in 2015 has attracted much attention.
2015, China's real estate sector will see lower mortgage rates, fewer inventories by developers and a lower contribution to GDP, according to a new Goldman Sachs report. Goldman Sachs expects property sales and prices to be roughly the same in 2015 as in 2014, with construction cooling as high inventories and "shadow credit" shrink.
, vice president and chief economist at Haitong Securities, recently wrote that China's economy was between deflation and bubble-squeezing in 2015. "In January-November 2014, the growth rate of electricity consumption of the whole society was only 2%, and even the growth rate of electricity consumption for residential residents has also declined sharply, And China's urbanization has entered a late stage, with the 25-44 age group being the main buyer in terms of population age structure, but the population of this age group will decrease net from 2015 onwards." Therefore, the future real estate should be faced with the pressure to go to the bubble, can maintain a stable house prices, the bubble is not broken has been good. "
prices of building materials fell to historical lows
in this situation, building materials-related industries to increase domestic and foreign competition has begun to emerge.
steel exports rose 42.2 percent from January to October from a year earlier to 73.89 million tons, according to the General Administration of Customs. According to the monthly data, exports in September and October were above 8.5 million tons.
analysts said that China's steel composite price index fell faster than the global level, the average export price is lower than the international level of 1500 yuan / ton, China's overcapacity background of steel prices continued weakness outside the formation of a certain competitiveness.
"China's steel flight", domestic competition is even worse. It is understood that due to seasonal factors, the construction period in northern China is relatively short, in real estate and other infrastructure projects after some or even all of the shutdown, iron ore, glass as the representative of the building materials market is facing a situation of saturation of demand, capacity overflow. However, according to industry sources, affected by the national real estate situation, the national building materials market price differential gradually narrowed, the north building materials to the south to face pressure, related commodities such as iron ore, steel, glass and other building materials varieties continue to fall is a high probability event.
futures market showed that as of yesterday, rebar, iron ore, glass and other commodity prices are close to the record low.
for example, the average price of grade III rebar was RMB2,766/tonne in December 2014, compared with a high of RMB5,866 per tonne in 2008, a decrease of 52.8%, down 21.7% from the beginning of the year. It is reported that in Laiwu, Shandong's main steel producer, nearly half of the steel trade enterprises have closed down.
Shi Yuchen, a researcher in the coal coking steel industry at Guoxin Futures, said that since 2014, the performance of various major steel industries, such as real estate and automobiles, has not been satisfactory, and the implementation of infrastructure investment has been constrained by insufficient local government funds, and construction progress has slowed. These have a negative impact on steel demand.
and subject to the constraints of large international miners, China's iron ore market diplomatic difficulties, not to be optimistic. Shi Yuchen said that because the cost of international iron ore producers is significantly lower than domestic, although the price of the mine fell by half in a year, but it still wants to expand market share, have stepped up production expansion, iron ore prices still have room to continue to decline in the future.
" for domestic steel mills, although spot steel prices continue to fall, but low raw material prices so that enterprises still have good profits, so steel mills still generally maintain high capacity utilization rate, which led to even in the winter this low season of steel demand, the spot market resource supply remains high, which also makes spot steel prices fall. ”