In February, the PMI of China's iron and steel industry was 50.6%, down 0.9 percentage points from last month. In the sub-index, the production index, the new export order index, the finished product inventory index and the purchase price index increased significantly, while the new order index decreased significantly.
PMI showed that steel mill production continued to expand in February, while downstream demand was reduced, and the market showed a pattern of oversupply and inventory backlog. At the same time, due to the rising prices of raw materials, especially iron ore, the cost pressure of steel mills has increased.
However, with the expansion of steel mill production and the acceleration of accumulating stores, the market has a wait-and-see attitude towards future market expectations. At the same time, we should pay attention to the trend of international iron ore prices and take appropriate measures. It is expected that during the two sessions in March, steel mill production may be limited, the impact of dam-break in Valley will still be apparent. And with the expected rebound in market demand, China's steel prices may have some upstream room for shocks.
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