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Self-discipline Proposal for the Steel Industry

May 27,2021  Steel Knowledge.


Since the beginning of this year, the steel market has been volatile. Especially since the May 1st, there has been a trend of ups and downs, which has a greater impact on the production and operation of the steel industry and the stable development of the upstream and downstream industrial chains. At present, China's steel industry is at a critical stage of historical development. It not only needs to deepen supply-side structural reforms, but also faces new challenges of carbon peaking and carbon neutrality. In this special period, the steel industry must base itself on the new development stage, implement new development concepts, build a new development pattern, unite self-discipline, and gather strength to promote the transformation and upgrading of the industry, promote low-carbon, green and high-quality development of the industry. Work together to create a fair, stable, healthy and orderly market environment. According to the relevant national policies and regulations of our country, combined with the actual situation of the steel industry, we propose:

 

Firstly, organize production on demand to maintain a balance between supply and demand. Maintaining a balance between supply and demand is a basic condition for stabilizing the steel market. Iron and steel enterprises should organize production rationally and increase the proportion of direct supply based on market demand. When major changes occur in the market, steel companies should actively promote the balance of supply and demand and maintain market stability through measures such as regulating output, optimizing product structure, and adjusting inventory.

 

Secondly, adjust export strategies to ensure domestic supply. Recently, the country has adjusted its steel import and export policy, encouraging the export of high-value-added products and restricting the export of low-end products. The policy orientation is obvious. Iron and steel enterprises should adjust their export strategies, put their starting point and goal on meeting domestic demand, give full play to the supplement and adjustment role of import and export, and adapt to the new development pattern of steel import and export.

 

Thirdly, play a leading role and strengthen regional self-discipline. Regional leading enterprises should give full play to the role of market "stabilizers" and take the lead in maintaining the smooth operation of regional markets. Regional enterprises should further improve regional self-discipline, avoid vicious competition, and promote the stable and healthy development of regional markets by strengthening exchanges and tapping potentials by benchmarking.

 

Fourthly, deepen industrial chain cooperation to achieve mutual benefit and win-win results. Normal fluctuations in the steel market are inevitable, but the ups and downs are not conducive to the sustainable and healthy development of the upstream and downstream industrial chains of the steel industry. The steel industry and downstream industries should strengthen communication and innovate cooperation models, realize the symbiosis and co-prosperity of the industrial chain, and form a new situation of mutual benefit, win-win and coordinated development.

 

Fifthly, resist vicious competition and promote orderly development. Recently, steel prices have fluctuated significantly, and the market has chased the rise and killed the decline, which has amplified the fluctuation of steel prices and is not conducive to the smooth operation of the steel market. Iron and steel companies must resist vicious competition, oppose price-raising behaviors.

 

that are far above cost during price increases, and oppose dumping of prices below cost during price downturns. Work together to maintain fair market competition and promote the orderly and healthy development of the industry.

Sixthly, strengthen market monitoring and issue early warnings in a timely manner. The Iron and Steel Association must play the role of industry associations, strengthen the monitoring of information on the supply and demand of steel market, prices, etc., do a good job in market analysis and research, and issue early warnings for enterprises in a timely manner. Especially when there are major fluctuations in the steel market and major adjustments to national policies, meetings are held in a timely manner according to the market situation to inform the relevant situation to help enterprises grasp the market situation and better carry out production and operation.

 

Seventhly, assist market supervision and strictly prevent malicious speculation. Cooperate with relevant state departments to strengthen the supervision of the future market linkage, investigate abnormal transactions and malicious speculation, assist in the investigation and punishment of the implementation of monopoly agreements, spread false information, and drive up prices, especially hoarding. Build a stable and orderly market order to promote the high-quality development of the industry.

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