中國令人難以置信的鋼鐵暴跌指向供應過剩的困境

Recently Yahoo News on-line reported the following:

China’s Implausible Steel Plunge Points to Oversupply Dilemma

Bloomberg News

Mon, January 29, 2024 at 5:45 p.m. PST·5 min read

(Bloomberg) -- Did China’s steel industry really get within a whisker of meeting Beijing’s production cap last year?

If official data are to be believed, 2023 output ended up barely changed at just over 1 billion tons, thanks to an unprecedented 15% year-on-year plunge in output in the last month to a six-year low. In data going back to 2004, it’s only the second time that December has been lower than November, and never by that margin.

There are other indications that what seems too good to be true often is. Steel analysts, who declined to be named as the matter is sensitive, are among those pointing to conflicting data: iron ore imports that hit a record in 2023 without disturbing inventory levels, rising rebar stockpiles, and increased output of steel products.

China’s official figures are frequently viewed as conveniently close to political targets and few challenges are as thorny as curbing oversupply in the vast and fragmented steel sector. But stir in President Xi Jinping’s climate goals and the need to preserve employment in an industry that was loss-making for much of 2023, and steelmakers are left juggling an often conflicting set of incentives.

“China’s highly competitive steel mills will probably accept operating losses rather than taking on the much larger cost of full closure,” said Tom Price, head of commodities strategy at Liberum Capital Ltd. in London. “Furthermore, an incentive exists for the mills to under-report production, to avoid government sanctions.”

The order from the National Development and Reform Commission, China’s top economic planning agency, to reduce or maintain production at the previous year’s level has been in place since 2021 to curb overcapacity and the industry’s carbon footprint. The general view in the final months of 2023 was that steelmakers hadn’t cut enough to get even close to the annual cap.

The China Iron and Steel Association, which represents the biggest steelmakers, declined to comment.

The sensitivity around steel extends beyond its obvious importance as a key building block of the economy. China’s by far the world’s biggest supplier and producing the alloy is highly polluting and carbon intensive, accounting for about 15% of the country’s total emissions. Reducing those is crucial to meeting President Xi Jinping’s climate goals. Meanwhile, China’s exports, which hit a seven-year high in 2023, have drawn scrutiny over the years amid accusations that Beijing is prone to dumping its surplus abroad to the detriment of rivals.

Those rising exports are just one sign of how dismal domestic conditions have created a glut of steel in China, where demand is heavily keyed to the crisis-ridden property market.

Limited Stimulus

China’s commodities sector has found creative ways in the past to ensure it hits its targets. Overseas coal purchases recorded in the last month of 2019 were an astonishingly low 2.8 million tons after ports delayed cargo clearances, allowing importers to creep under the annual limit at the time of 300 million tons. In January 2020, imports ballooned to over 43 million tons as the excess shipments were released, setting a monthly record that stood for almost four years.

Steel mills may be hoping that their excess gets soaked up once Beijing is forced to unleash massive infrastructure spending to revive growth. But that’s a big ‘if’ given the parlous state of local government finances, and the authorities have so far been content to offer only limited stimulus to sustain the economy. China’s habit of combining January and February data to smooth out inconsistencies due to an irregular lunar new year could also be an opportunity to mask any surplus.

Officials haven’t said if they’re looking at whether the steel industry fudged its numbers. Neither the statistics bureau nor the NDRC responded to requests for comment. But Beijing has launched a new crackdown on statistical fraud, elevating the issue by making the Communist Party’s disciplinary body responsible for punishing manipulation.

And the government’s curbs on production aren’t going away.

“It is likely that another cap on output will be issued by Chinese policymakers to curb emissions this year,” Capital Economics Ltd. said in a note.

Translation

（彭博）—去年中國鋼鐵業真的已經差不多達到北京的產量上限了嗎？

如果官方數據是可信的話，2023 年產量最終幾乎沒有變化，只略高於 10 億噸，這要歸功於上個月產量同比前所未有地暴跌 15% 至六年來的低點。 從 2004 年以來的數據來看，這只是 12 月第二次低於 11 月，而且從來沒有如此的幅度。

還有其他跡象表明，看似好得令人難以置信的事情往往是難以相信的。 由於此事敏感而拒絕透露姓名的鋼鐵分析師也指出了相互矛盾的數據：2023 年鐵礦石進口量創下歷史新高，但並未影響庫存水平，增加鋼筋網庫存，增加鋼鐵產品產量。

中國的官方數據常常被認為很接近政治目標，而很少有比去遏制龐大而分散的鋼鐵業的供應過剩更的挑戰加棘手。 但隨著習近平主席的氣候目標, 和保住2023年大部分時間虧損的行業的就業需要，鋼鐵製造商不得不在一系列經常相互衝突的激勵措施之間作出周旋。

倫敦 Liberum Capital Ltd. 大宗商品策略主管 Tom Price 表示： “有高度競爭激力的中國的鋼廠可能會接受經營虧損，而去避開承擔全面關閉的更大代價。” “此外，工廠有動機低報產量以避免政府的制裁。”

中國最高經濟規劃機構國家發展和改革委員會自 2021 年起就下令減少產量或維持上年水平，以遏制產能過剩和產業碳足跡。 2023 年最後幾個月的普遍觀點是，鋼鐵製造商的減產力度還不足以接近年度上限。

代表最大鋼鐵製造商的中國鋼鐵工業協會拒絕置評。

圍繞鋼鐵的敏感性, 超出了其作為經濟關鍵組成部分的明顯重要性。 中國是迄今為止世界上最大的供應國，其生產的合金污染嚴重，碳排放量大，約佔全國總排放量的15%。 減少這些對於實現習近平主席的氣候目標至關重要。 同時，中國的出口在2023年創下七年來的新高，因為有人指責北京傾向於將其過剩供應傾銷到海外，損害競爭對手的利益, 這多年來一直受到密切關注，。

這些出口上升只是國內情況嚴峻造成中國鋼鐵過剩的一個跡象，而中國的鋼鐵需求在很大程度上取決於飽受危機困擾的房地產市場。

有限度的刺激

中國的大宗商品產業過去已經找到了有創意的方法來確保實現目標。 由於港口延遲貨物清關，2019年最後一個月的海外煤炭採購量驚人地低至280萬噸，使得進口商的採購量低於了當時3億噸的年度限額。 2020年1月，隨著超額貨量的釋放，進口量激增至超過4300萬噸，創下近四年來的月度紀錄。

鋼廠可能希望，如果當北京一旦被迫開放大規模基礎設施支出以重振經濟成長時，其過剩產能就能被吸收。 但鑑於地方政府財政狀況不佳，這只是一個很大的 “如果” ，而且當局迄今為止只滿足於僅提供有限的刺激措施來維持經濟。 中國習慣將一月和二月的數據合併起來，以消除農曆新年不規則造成的不一致，這也可能是掩蓋過剩的機會。

官員尚未表示他們是否正在調查鋼鐵業是否捏造了數據。 國家統計局和國家發展委員會均未回應置評請求。 但北京發起了新一輪打擊統計造假的行動，令共產黨的紀檢機構負責懲罰操縱的行為提升了這問題。

政府對生產的限制也不會消失。

Capital Economics Ltd. 在一份報告中表示： “中國政策制定者今年可能會再次出台產量上限，以抑制排放。”

So, China’s intention to reduce or maintain steel production at the previous year’s level has been in place since 2021. The general view in the final months of 2023 was that steelmakers hadn’t cut enough to get close to the annual cap set by the authority. Steel mills may be hoping that their excess production can be soaked up once Beijing is forced to unleash massive infrastructure spending to revive growth. Officials haven’t said if they’re looking at whether the steel industry is manipulating the numbers, yet I think the steel industry in China may have a hard time ahead.