Beneficial products increase in price, steel and non-ferrous profits soar

The National Development and Reform Commission announced on the 28th the operation of the main high-energy industry in the first three quarters of 2010. The results showed that the price of steel (4319, 10.00, 0.23%) rose slightly in September, and the prices of major non-ferrous metals continued to rise. In terms of profit, in the first eight months, the steel industry realized a profit of 161.3 billion yuan, a year-on-year increase of 95.7%; in the first 8 months, the non-ferrous industry realized a profit of 93.5 billion yuan, a year-on-year increase of 1.2 times.
Experts pointed out that steel prices may continue to rise in the fourth quarter, corporate profits will increase further, and non-ferrous metals prices will fluctuate.

Steel, non-ferrous metals
Price rose slightly
According to the data of the National Development and Reform Commission, China's steel prices have risen slightly. In September, the domestic market steel price composite index averaged 119.57, up 3.33 points from the previous month and up 15.43 points year-on-year. The average price of 6.5mm high wire, 20mm medium plate and 1.0mm cold rolled coil was 4414 yuan/ton, 4504 yuan/ton and 5380 yuan/ton respectively, up 178 yuan/ton, 92 yuan/ton and 98 from last month. Yuan/ton, up 24.2%, 24.8% and 9.3% year-on-year.

The price of major non-ferrous metals continued to rise. In September, the average spot prices of copper, electrolytic aluminum, lead and zinc in the domestic market were 60,123 yuan/ton, 15,526 yuan/ton, 16,548 yuan/ton and 17,705 yuan/ton, up 3.7%, 1.3% and 1.8% from the previous month. And 4.2%, up 22.6%, 3%, 5% and 16.2%.

CICC believes that steel prices will fluctuate in the fourth quarter, including: the start of demand in the peak season, the construction of affordable housing will accelerate before the end of the year; the impact of energy-saving and emission reduction policies on production will continue until the end of the year, although the implementation is relatively September. Slightly relaxed, but production will still be at a low level; overseas liquidity will push up the price of minerals and support steel prices.

For the price change of steel non-ferrous metals in the fourth quarter, Zhang Yongjun, a researcher at China International Economic Exchange Center, believes that steel prices began to fluctuate in January this year and began to rise after the third quarter, but the magnitude is not particularly high. For the change of colored prices, Zhang Yongjun believes that it is mainly RMB. The hype brought about by the appreciation.

Rapid profit growth
The data shows that in the steel industry, the country's crude steel output in the first three quarters was 47.453 million tons, up 12.7% year-on-year, and the growth rate accelerated by 5.2 percentage points year-on-year; steel output was 599.84 million tons, up 19%, accelerating by 6.6 percentage points.

In the first eight months, the steel industry realized a profit of 161.3 billion yuan, a year-on-year increase of 95.7%, a decrease of 66.4% in the same period last year. Among them, the profit of ferrous metal mining and dressing industry was 40.2 billion yuan, up 1.3 times, down 62.6% in the same period of last year; the profit of ferrous metal smelting and rolling processing industry was 89 billion yuan, up 99.7%, down 71.7% in the same period last year.

In the non-ferrous metals industry, in the first three quarters, the output of ten non-ferrous metals in the country was 23.57 million tons, a year-on-year increase of 23.9%, and a decrease of 0.5% in the same period last year.

In the first eight months, the non-ferrous industry realized a profit of 93.5 billion yuan, a year-on-year increase of 1.2 times, and a decrease of 52.9% in the same period last year. Among them, the profit of non-ferrous metal mining and dressing industry was 29.9 billion yuan, up 95.5%, down 44.1% in the same period of last year; the profit of non-ferrous metal smelting and rolling processing industry was 63.5 billion yuan, up 1.3 times, down 56.8% in the same period last year.

For the profitability of the fourth quarter, Wei Fengchun, chief macro analyst of CITIC Jiantou, believes that the profit of steel and non-ferrous enterprises in the fourth quarter may be affected by energy conservation and emission reduction policies. Since this year, China’s energy conservation and emission reduction has increased, mainly to adjust economic growth. Structure, transforming the way of economic development, so next year, investment opportunities in high-energy-consuming industries may not be as big as this year.

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