Macro | Policy
1
Li Keqiang presided over a symposium on stabilizing growth, stabilizing market entities and ensuring employment
On May 18, Premier Li Keqiang presided over a symposium on stabilizing growth, stabilizing market players and ensuring employment. It is required to increase macro-policy adjustment. The policies that have been introduced must be put in place as soon as possible, the new measures that can be seen can be exhausted, and all can be released in May, so as to ensure that the economic operation in the first half of the year and the whole year is within a reasonable range, and strive to bring the economy back to the normal track quickly. We must give priority to employment, and ensure employment and people’s livelihood by stabilizing market players. Ensure stable food production and stable energy supply. Support the platform economy and digital economy for legal and compliant domestic and overseas listing and financing. Stabilize land prices and house prices, support residents’ reasonable housing needs, and maintain the stable and healthy development of the real estate market.
2
Development and Reform Commission: Economic operation will soon return to normal track
On May 17, the National Development and Reform Commission held a press conference for May. The spokesperson Meng Wei said that the complexity, severity and uncertainty of my country’s economic development environment have increased, and stable growth, employment, and prices are facing new challenges, especially Affected by the new round of epidemic and the unexpected changes in the international situation, the new downward pressure on the economy has increased. However, we have also seen that with the effective prevention and control of the epidemic and solid progress in resumption of work and production, the economic operation has quickly reversed the downward trend, and the development trend has recovered quarter by quarter. At present, the rebound of the domestic epidemic has been effectively dealt with, and various policies have been put forward and their effects are gradually released. It is believed that the normal economic order will be restored quickly, and the economic operation will soon return to the normal track.
3
Ministry of Industry and Information Technology: It is necessary to implement the “white list” system to ensure the stable operation of key enterprises and industrial chain supply chains
On May 17, Xin Guobin, member of the party group and vice minister of the Ministry of Industry and Information Technology, presided over a video conference on the analysis of industrial economic situation in ten provinces and cities. The meeting emphasized that it is necessary to fully implement the overall requirements of “preventing the epidemic, stabilizing the economy, and developing security”, taking effective measures to ensure the stability of the industrial chain and supply chain, and focus on stabilizing the industrial base. It is necessary to implement the detailed “white list” system, coordinate and do a good job in enterprise docking and precise services, and lead the chain from point to point and chain to surface to ensure the stable operation of key enterprises and industrial chain supply chains. We must make full use of the bailout and assistance policies of various market entities, continue to release policy effects, and promptly plan incremental policy tools to further stabilize market expectations and boost corporate confidence.
4
UN cuts global growth forecast for 2022
The United Nations released the “World Economic Situation and Prospects in Mid-2022” on the 18th local time. The report predicts that as the global economic recovery is disrupted by the conflict between Russia and Ukraine, which has triggered a huge humanitarian crisis, raised food and commodity prices, and exacerbated inflationary pressures on a global scale. The report shows that the global economic growth rate in 2022 is lowered to 3.1%, which is lower than the 4% growth rate forecast released in January 2022. The report expects global inflation to increase to 6.7 percent in 2022, double the 2.9 percent average for the 2010-20 period, and food and energy prices to rise sharply. Among them, the EU’s economic growth prospects have weakened significantly, and EU GDP is expected to grow by only 2.7% in 2022, instead of the 3.9% predicted in early January.
casting raw material
1
Foundry raw materials: supply and demand are weak, prices continue to decline
The raw material market is affected by the reduction of steel prices, low profits of steel mills, and weak demand. This week, the overall price showed a steady downward trend. The spot price of imported ore fluctuated slightly, the price of domestic ore was weak, and the market transaction was average. The prices of steel billets, scrap steel and pig iron were all affected by the sharp drop in steel products, and the transactions were normal. Ferroalloy prices maintained stable operation, and transactions were weak. Due to the tight domestic spot supply in the copper and aluminum market, the price kept rising slightly.
2
iron ore
Although the epidemic is gradually under control, the progress of resumption of work is slow, the profit of steel mills is still low, and the overall demand is weak. The spot price of imported ore fluctuated slightly this week, and the price of domestic ore was weak. On Friday, the price of PB powder in Qingdao Port was 937 yuan/ton, up 8 yuan/ton from the previous month, or 0.8%; 1141 yuan / ton, an increase of 1 yuan / ton from the previous month.
3
billet
This week, futures prices fluctuated and weakened. Some steel rolling mills are still under the control of the epidemic, production is not normal, and the price decline has also caused steel rolling mills to be more cautious in purchasing, and their willingness to buy goods is not strong. The price of billet in Tangshan on Friday was RMB 4,510/ton, down RMB 140/ton or 3% month-on-month.
4
scrap
Recently, the futures market has continued to be weak, and the impact of the epidemic is still continuing. It has rained heavily in some areas, and it is difficult for the demand to increase significantly, and the price of finished products has dropped significantly. This week, the overall mentality of the scrap steel market is weak, and the merchants are not optimistic about the market outlook. Foundry scrap in Xuzhou was 3,690 yuan/ton on Friday, down 90 yuan or 2.4% month-on-month.
5
pig iron
This week, the price of pig iron decreased steadily, and the cost of pig iron continued to decline. In addition, the downstream foundries were still insufficient, so they were all purchased on demand. The steel price fell, the profit of the iron factory was meager, and the businessman’s mentality was not optimistic. The price of pig iron in Linyi was 4,400 yuan/ton on Friday, down 150 yuan/ton or 3.3% from the previous month.
6
ferroalloy
This week, the ferrosilicon futures fluctuated and the spot price remained stable, mainly on the sidelines. On Friday, the price of ferrosilicon FeSi75-A in Inner Mongolia was 9,300 yuan/ton, down 200 yuan/ton or 2.1% from the previous month; the consolidation of silicon manganese was weak, the transaction was poor, and the cost was still high; the price of high carbon ferromanganese was slightly loose , the port manganese ore transaction was sluggish, and the price fell slightly. Yunnan 75# high-carbon ferromanganese closed at 8,800 yuan/ton, down 50 yuan/ton or 0.5% from the previous month.
7
copper aluminum
This week, the supply and demand in the copper and aluminum market are acceptable, the domestic spot supply is still tight, the superimposed import profit has narrowed, and the willingness to inquire about prices has increased, supporting the premium to remain high. The price of electrolytic copper fluctuated and the price of aluminum alloy remained stable. The price of 1# electrolytic copper in Shanghai on Friday was 72,145 yuan/ton, up 895 yuan/ton, or 1.2% month-on-month; Shanghai aluminum alloy ADC12 price was 20,800 yuan/ton, down 100 yuan/ton, or 0.4% month-on-month.
Price chart of raw and auxiliary materials (yuan/ton)
(Note: Imported iron ore concentrate-PB powder-Qingdao is the right secondary axis)
List of market prices of foundry raw materials
Metallurgy | Foundry
1
Xinxing Casting Pipe was rated as a global influential brand
According to reports, on May 10th, on the occasion of the sixth “China Brand Day”, Xinxing Casting Pipe Co., Ltd., Baowu Iron and Steel, Hegang Group and other 16 enterprises were widely expected, ranked the first list and won the “2022” “Global Influential Brand in the Steel Industry” Award.
2
The list of foundry capacity recently announced by the Department of Industry and Information Technology
1. Xuancheng (the fourth batch) plans to withdraw from the foundry capacity:
Langxi Jinda Counterweight Machinery Co., Ltd. withdrew production capacity 43,224 tons/year
Langxi County Xinghuo Machinery Equipment Co., Ltd. withdrew production capacity 64,333 tons/year
Langxi Tongzhou Sports Equipment Co., Ltd. withdrew production capacity 52,271 tons/year
A total of 159,800 tons
2. Hefei Hangya New Material Technology Co., Ltd. Construction capacity of 11,181 tons/year
3
Lan County: Foundry Industrial Park will form a casting capacity of 300,000 tons
This year, Lan County took the lead in launching the construction of 81 key projects with a total investment of 14 billion yuan. The foundry industrial park upgrading project is a key construction project of Lanxian Economic and Technological Development Zone to build a green intelligent foundry base integrating production, education and research. The total investment of the project is 550 million yuan, covering an area of 250,000 square meters. 10 fully enclosed steel structure standard workshops are newly built, and supporting production, living, scientific research and other areas. So far, 5 standardized workshops have been built. After the project is completed, it will form a casting capacity of 300,000 tons, further improve the level of intelligent equipment in Lanxian Economic and Technological Development Zone, and comprehensively improve the casting equipment, casting materials, and casting processes.
4
Wudang Mountain Special Zone accelerates the comprehensive treatment of waste gas clusters in the foundry industry
The comprehensive treatment project of waste gas clusters in the foundry industry in Wudang Mountain Special Zone, Shiyan City, Hubei Province, successfully applied for the central air pollution prevention and control special fund of more than 6.5 million yuan, helping enterprises to promote the upgrading and transformation of waste gas pollution prevention and control facilities. At present, the in-depth treatment projects of 3 pilot enterprises have been basically completed and achieved good results. It is expected that before the end of June this year, all 10 foundry enterprises in the jurisdiction will complete the in-depth treatment of waste gas and smoke and dust.
5
During the “13th Five-Year Plan”, my country’s new iron ore resources amounted to 855 million tons, a year-on-year decrease of 93.56%
According to “Development Achievements of my country’s Geological Exploration Industry During the “Thirteenth Five-Year Plan” Period – Geological Prospecting Achievements”, during the “Thirteenth Five-Year Plan” period, my country’s new iron ore resources amounted to 855 million tons, a decrease of 93.56% compared with the “Twelfth Five-Year Plan” period; The newly added resource of manganese ore in my country is 135.8186 million tons, which is 82.36% lower than that in the “Twelfth Five-Year Plan” period.
6
Volkswagen’s rear body one-piece aluminum die-casting prototype rolls off the assembly line
According to media reports, the Volkswagen rear body one-piece aluminum die-casting prototype rolled off the production line. The aluminum die-casting prototype was produced by a 4,400-ton die-casting machine, replacing about 30 parts and reducing the weight by 10kg. It is understood that the one-piece die-casting part of Volkswagen’s rear body is prepared for the Trinity project based on the Volkswagen SSP platform. To produce a new generation of electric vehicles, Volkswagen will build a brand new factory in Wolfsburg, Germany, where it is expected to produce the first Trinity pure electric vehicles from 2026, at an investment of around 2 billion euros ($2.21 billion).
casting related
1
In April, 1.74 million machine tools were exported, a year-on-year decrease of 22.3%
According to data from the General Administration of Customs, 1.74 million machine tools were exported in April, a year-on-year decrease of 22.3%. From January to April, a total of 7.56 million machine tools were exported, a year-on-year decrease of 8.4%.
In April, 9,640 tractors were exported, down 22.6% year-on-year. From January to April, a total of 46,845 tractors were exported, a year-on-year increase of 10.1%.
2
In April, China’s excavator output was 13,981 units, a year-on-year decrease of nearly 60%
According to data from the National Bureau of Statistics, the output of excavators in April was 13,981 units, a year-on-year decrease of 58.9%. The cumulative output from January to April was 106,459 units, a year-on-year decrease of 27.3%.
In terms of tractors, the output of tractors continued to decline in April, and the decline of small tractors continued to expand. The output of large, medium and small tractors was 10,146 units, 27,690 units and 14,000 units respectively, down 12.1%, 23.7% and 30% year-on-year. From January to April, the cumulative output of large, medium and small tractors was 36,918 units, 120,212 units, and 58,000 units, down 6.5%, 10.8%, and 17.1% year-on-year, respectively.
3
In April, the sales volume of internal combustion engines was 2.6708 million units, a year-on-year decrease of 40.13%
According to data from the China Internal Combustion Engine Industry Association, the sales volume of internal combustion engines in April was 2.6708 million units, a year-on-year decrease of 40.13%. The power was 129.1999 million kilowatts, a year-on-year decrease of 53.73%. From January to April, the cumulative sales volume of internal combustion engines was 14.2336 million units, a year-on-year decrease of 15.55%. The accumulated power was 848.7516 million kilowatts, a year-on-year decrease of 22.36%.
4
9.58GW of new grid-connected wind power was added from January to April
On the 17th, the National Energy Administration released statistics. As of the end of April, the national installed capacity of power generation was about 2.41 billion kilowatts, a year-on-year increase of 7.9%. Among them, the installed capacity of wind power is about 340 million kilowatts, a year-on-year increase of 17.7%; the installed capacity of solar power generation is about 320 million kilowatts, an increase of 23.6% year-on-year.
From January to April, the newly installed capacity of grid-connected wind power nationwide was 9.58 million kilowatts, a year-on-year increase of 2.98 million kilowatts; the newly installed solar power generation capacity was 16.88 million kilowatts, an increase of 9.8 million kilowatts year-on-year.
5
Battery costs could soar 22% by 2026
The cost of producing electric vehicles will soar over the next four years due to a shortage of key raw materials for electric vehicle batteries, according to a report from Colorado-based research firm ESource on May 19. “The wave of battery demand is coming, but I don’t think the battery industry is ready for it,” said Sam Jaffe, ESource’s vice president of battery solutions. Battery prices have fallen in recent years as global EV battery production has increased. The current average battery price is $128/kWh, which could drop to $110/kWh by next year, according to ESource estimates. But the drop in average battery prices won’t last long. ESource estimates that battery prices will surge 22% between 2023 and 2026, reaching as high as $138/kWh, before returning to a steady downward trend by 2031, possibly as low as $90/kWh.