Since the beginning of this year, the global crude steel capacity utilization rate has also begun to climb. According to the statistics of the World Steel Association, the world’s 64 major steel-producing countries produced 117 million tons of output in February, an increase of 8.8% over the same period. Capacity utilization increased from 80.9% in January to 82.0%, an increase of 2.7 percentage points from the same period last year.

In addition, the Great Japan Earthquake has a greater impact on crude steel and steel production. In 2010, crude steel production in Japan was approximately 109.6 million tons, ranking second in the world. At present, at least five major steel mills in Japan have suspended production, and production may be suspended for up to six months. The analysis report of Huabao Securities pointed out that although the impact of the earthquake in Japan on the supply of steel has little impact on the global economy, it has a more positive impact on the Southeast Asia region, especially the supply of high-end sheet metal. The second quarter will be fully reflected.

In the first two months of this year, China’s average daily crude steel output was 1,931,300 tons and 1,939,500 tons respectively. According to the data from the China Iron and Steel Association, the national average daily output of crude steel was 9.913 million tons in March, and it is estimated that the production of crude steel will be 59.325 million tons this month. In the middle of March, the average daily output of crude steel in the country was 1.945 million tons, which rose by 4.15% over the previous period, setting a record high, far exceeding the highest level of 1.773 million tons last year. From January to March, China produced a total of 173.5 million tons of crude steel, a year-on-year increase of 9.8%, with an average daily output of 1,927,800 tons, which was the highest level in the same period.

The industry believes that the current capacity utilization rate is at a relatively high level. After entering the second quarter, it will remain at a high level due to the peak demand season. However, due to the fact that the domestic capacity utilization rate has exceeded 90%, it is basically close to the limit because of the subsequent capacity increase. Limited, so there is limited room for growth in the second quarter. According to the seasonal cycle of the steel industry, it is expected that the total crude steel output in 2011 will reach 660 million tons. Among them, the annual crude steel production increased by 33.5 million tons year-on-year, an increase of 5.34% year-on-year; the apparent consumption amounted to 630 million tons, an increase of 4.9% year-on-year, and the growth rate fell by about 1.0% from 2010; net exports reached 30 million tons. It increased nearly 4 million tons over the previous year.

Market analysts believe that the pattern of supply and demand in 2011 will have a certain degree of relief compared with 2010, which will be conducive to the rise of steel prices and the improvement of earnings of steel companies. The second quarter will be reflected.

Market demand has entered the peak season. From January to March this year, China’s urban fixed asset investment increased by 25%, greatly exceeding previous expectations. This increase in investment also abolished the concern that the investment in fixed assets in cities and towns in this year may accelerate back down and affect steel demand.

However, such a high growth rate may be affected by the inertia of investment. From the significant drop in the year-on-year growth rate of completed fixed asset investment from January to March, the momentum of investment in fixed assets in the latter period was obviously insufficient.

According to the situation in the first quarter, considering that the consumption of crude steel for fixed assets investment per 100 million yuan has declined significantly with the progress of industrialization, the structural adjustment during the 12th Five-Year Plan period is the main theme, and therefore the decline is even greater. Taken together, the apparent consumption of crude steel in 2011 is expected to be 663 million tons (including inventory), an increase of about 6.2% year-on-year, higher than people had expected.

At the same time, the construction and real estate industry began to release steel demand. The industry believes that the second quarter will be the peak season for the construction of affordable housing, which will significantly boost the demand for rebar, wire rods, round bars and profiles, and will effectively compensate for the slowdown in growth caused by the regulation of commercial housing.