In recent years, china’s steel pipe industry has made great progress, but it still faces five major challenges.
1. Overcapacity led by the repeated investment and construction. China’s steel pipe industry in the last two years, not only a large number of production units, but also high-end equipment. In particular, seamless steel pipe has more than 10 production lines, and 10 units. Based on the highest production of 6.15 million tons per month in June last year, China ‘s steel production capacity has reached 74 million tons. In addition, some non-iron and steel enterprises are also investing in the steel pipe industry to expand overcapacity, not only increased the risk of investment, increased market competition, but also affect the stability of steel prices. This is why the price of Chinese steel pipe is unreasonable for a long time.
2. Increase costs, reduce profits. Iron ore and other raw material prices, continue to rise sharply so the cost of steel pipe is also increasing, and profits dropped significantly. Last year, from January to August, the average CIF price of iron ore was US $ 164.36 per ton, up 37.5% from a year earlier. Other raw material prices are also soaring, such as iron ore, coke, scrap, billet, steel and so on. At the same time, the domestic market has shown that the situation of excess supply did not improve the price of steel pipe, only less than 5% increase compared to the beginning of this year. Due to a substantial increase in the price of raw materials, steel pipe business profits continued to decline. It is estimated that the main sales profit margin is only 1%, lower than the steel pipe industry average sales profit margin.
3. International trade protectionism has intensified. China has become a net exporter of steel pipe, since 2005 than exports increased significantly year by year, causing concern of international counterparts. Double Negative Surveys Since 2009, global trade protectionism has grown stronger, with the exception of Europe and the United States, Russia, India, Brazil, Mexico, Canada, Argentina and other countries have taken sanctions against Chinese steel exporters, including anti-dumping and setting investigations Tax, which will further limit the export of Chinese steel pipe. This view held by wilsonpipeline Pipe Industry Co., Limited should control the export volume and develop a stable long-term market rather than focusing on immediate profits.
4. End products can not meet the needs of consumers. In some cases, the specific requirements of consumers in the specifications and quality of steel pipes, however, the domestic products can not meet their requirements due to unstable production, quantity shortage and other reasons, so they have to choose foreign products in a relatively High price. Last year, from January to August, China imported 54,100 tons of oil pipeline and 54,000 tons of heat pipe, accounting for 30.84% of total imports and 30.78% of the seamless steel pipe and pipe. The development of oil well pipes should focus on high-end products such as hydrogen sulfide and CO2-corrosion resistant piping and alloy pipe seals and special threaded joints.
5. Elimination of backward production capacity is a difficult task. The leading technology in the China’s steel pipe industry produces seamless and welded steel pipes, as well as backward galvanized welded steel pipe for the production process. The latter one is still using low-end equipment and is environmentally friendly and should be improved or eliminated in the future.
The face of complex circumstances, steel pipe enterprises should take some measurements. First, improve the ability of quality control, the establishment of a scientific regulatory system of production and staff. Second, deepen internal management, improve efficiency and profits. Third, adjust the product structure, expand the market. Finally, strengthen the industry self-discipline, to avoid vicious competition and safeguard common interests.
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