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Profile of Metals & Mining Roadshow 2010
SendTime:2010-9-4   Hits:4314
Metal& Mining Roadshow 2010 jointly held by Bloomberg L.P. and Shanghai SteelHome raised its curtain in Grand Hyatt Shanghai hotel on September 1, 2010.

Janet Kong, Managing Director with Research Department of China International Capital Corp Ltd, made a speech on Economic Outlook. Lynn Raebsamen, Commodities and Derivatives Specialist with Bloomberg L.P. gave an address on How to Capitalize on Metals & Mining Market Intelligence. Kenneth Hoffman, Senior Analyst of Basic Material with Bloomberg L.P. shared his views on Solving China’s Steel Overcapacity Problem. Shawn Morvotjoe, Principal Transaction Advisory Services with Ascent Partners showed his opinions on Valuation of Mining Companies . Cameron Hunt, Director of Iron Ore Index with Metal Bulletin, gave an introduction of Iron Ore and Steel Indices . Gavin Xing, Head of Commodities Sales & Origination-Greater China, Deutsche Bank Group discussed the topic of Iron Ore Swaps-the Next Metals Market Boom.

Wen Wenzhang, President of Shanghai SteelHome website gave a keynote address on Analysis and Outlook on Steel Market and Iron Ore Demand.

1 Sustainable and rapid development of Chinese economy is the major force that encourages China steel industry. The ratio of China steel export to production is lower than other countries, which indicates that China steel industry development is based on domestic demand.

2 The rapid development of China steel industry push up iron ore demand, and create good environment for global iron ore industry.

3 Chinese government is promoting the transition of economic growth mode, the adjustment of economic structure and the expansion of consumption. Steel intensity per unit of GDP will gradually decline with the change of economic growth mode.

4 China crude steel production and consumption will peak in 2012. Steel consumption may show downwards trend after 2015.

5 China steel mills expand iron ore mining and accelerate cooperation with overseas miners. China iron ore capacity may increase in next five years. With the increase of aggregate steel consumption, obsolete scrap rises. China’s dependence on iron ore offshore suppliers is decreasing.

6 With the recovery of global economy and steel capacity utilization, iron ore demand will surge. The tension in metallics supply will extend into 2012. Afterwards, the growth in iron ore demand may fall as capacity additions release, China steel demand remain high and scrap recycle increases.

7 China steel market in 2010 show rising production, improving exports, basic balance in supply/demand, higher operating cost brought by rising iron ore price, and faltering profit margins of Chinese steel mills. China steel price may swing in a low level.

Finally, he presented a long-term outlook on China's steel and raw material demand as well as production.

1 China’s crude steel demand has been approaching the peak. Up to 2009, China’s accumulative steel consumption per capita was 3.9 tonnes, 5 tonnes lower than Japan’s performance. China could basically catch up with Japan’s pace ten years later on the basis of current annual steel consumption.

In 2012, China crude steel production may be around 680 million tonnes and consumption may be 650 million tonnes. During 2013-2015, China crude steel production and consumption would basically sustain at that level. Afterwards, consumption may decline. In 2020, crude steel consumption would gradually drop to 600 million tonnes or even lower. China crude steel production depend on steel demand from global market.

2 China steel industry make great contribution to international iron ore market. Global iron ore trade in 2009 was 941 million tonnes, an increase of 439 million tonnes over 2000. China iron ore imports in 2009 soared 558 million tonnes over 2000 to 628 million tonnes. The increase of global iron ore trade was basically consumed by China steel industry.

3 On the increase of China scrap recollection and the release of Chinese iron ore capacity, China’s dependence rate on offshore iron ore suppliers will decline. It is predicted that China’s obsolete scrap recollection will reach 65 million tonnes in 2010 and overtop 100 million tonnes in 2015; China will produce 1.05 billion tonnes of raw iron ore in 2010 and 1.45 billion tonnes in 2015. China iron ore imports will be around 625 million tonnes in 2010 when the dependence rate is 63 percent; if China domestic capacity additions fully release, the imports would be 484 million tonnes in 2015 when the rate drops to 50%.

4 2009 may witness the largest iron ore imports of China. After that, the inbound shipments will trend down year after year. Global iron ore supply will be tight before 2012. From 2013, the iron ore supply-demand situation may reverse.

5 In 2010, China crude steel production will hit around 630 million tonnes, up 10.9 percent year on year; apparent steel consumption will be around 610 million tonnes, up 7.8 percent year on year.

The conference will be held in Shanghai, Beijing and Hong Kong during September 1-3.

Glance of the conference

Wu Wenzhang, President of Shanghai SteelHome website

Chen Hansen, Country Manager of China with Bloomberg L.P. made an opening speech

Janet Kong, Managing Director with Research Department of China International Capital Corp Ltd

Lynn Raebsamen, Commodities and Derivatives Specialist with Bloomberg L.P.

Kenneth Hoffman, Senior Analyst of Basic Material with Bloomberg L.P.

Cameron Hunt, Director of Iron Ore Index with Metal Bulletin

 Gavin Xing, Head of Commodities Sales & Origination-Greater China, Deutsche Bank Group


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