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Opportunities and challenges of China's steel exports to the Latin American market
Latin American region is China's iron and steel important overseas markets, the development of Latin American steel industry has a great impact on China's steel export situation. This paper briefly analyzes the impact of the steel market in Latin America in the region and the impact of the steel imports in the region, at the same time, the future development trend of the Latin American region to make forecasts for the Chinese enterprises to open up overseas markets to provide a reference.
One, China's steel exports to Latin America grew rapidly
Latin America region is China's iron and steel important overseas markets, in recent years, China's steel exports in Latin America has been in a steady growth in 2014 exports reached a record high of 8300000 tons, an increase of 9.8%, accounting for 56% of China's steel exports.
From the point of view of the structure of export products, Chinese exports to the Latin American region is mainly flat material, 2014 exports accounted for 67% of the total in Latin America, the main varieties of alloy plate volume (220 million tons), hot dip galvanized (110 million tons) and cold rolling board (100 million tons). Long timber exports 2300000 tons, of which 1200000 tons of wire rod, bar 850000 tons.
Chart 1 2006-2014 China's exports to Latin America
Chart 22014 Chinese steel exports to Latin American varieties structure
Two, the impact of imported steel local steel market in Latin America
A total of 34 countries in Latin America, the level of economic development in these countries are mostly in the stage of developing countries or less developed countries, the investment in infrastructure and other construction projects, so the demand for steel is very large. Before it can be said that due to the Latin American countries steel production is difficult to meet the needs of the local market, must be met through imports, but in recent years, the rapid development of Latin America's steel industry has been able to meet the local demand, but still rapid growth in steel imports. At the same time, due to the global economic slowdown, steel exports in Latin America blocked, the steel trade deficit continued to expand, the long-term international trade imbalance has affected the structure of the Latin American Iron and steel industry, while a large number of low-priced imports of steel also suppressed the production of steel in the region. Imported steel has become one of the key factors to inhibit the development of Latin American steel industry.
Chart 3 Latin American region steel production in 2006-2014
Chart 4 2006-2014 Latin American steel import and export situation
On the one hand, Latin America's consumption of steel is more and more to meet by the import. 2014 Latin America's imports of finished steel 18420000 tons, an increase of 3%, imports accounted for about 27% of the local market share. In addition, due to the global iron and steel production overcapacity and demand slowdown, the export volume of Latin American steel also fell, resulting in the decline in output of the region. For example, the largest steel industry in Latin America, the largest capacity utilization rate of 2014 in Brazil, while the historical average of 86%.
On the other hand, according to the Latin American Iron and Steel Association (Alacero) survey and research found that the total amount of steel imports increased by $1000000, the Latin American regional metal - mechanical sector will lose 46-64 direct, indirect or derived from the employment, the current steel industry in Latin America has seen a trend of decline in the number of industries.
At the same time, lower profit margins led to a weak investment in the steel industry. At present, Latin American Iron and steel industry is facing "Dutch disease": the mining sector prosperity and foundation is weak, the obsession with the metal mechanical sector clients, the region is moving in the "to industrialization" direction of development, continuously for a long time, the iron and steel industry will completely lose its customer base, iron and steel industry be waning.