Steel prices are weakening, but the Chinese steel mills are still expanding production, which can not help but let those originally worried for the steel industry analysts worry on the plus worry: the industry is likely to face a price crash.
 
The latest round of industry data show to track steel production to 10 days for a cycle, early August, China's steel production increased by 1.1%, breaking the outside world that the country's steel production is expected to fall.
 
Affected by the data, Nomura (Nomura) analyst report released on Tuesday said they are very worried. Before they predict that China's steel production there will be a decline of 5%.
 
This data is indeed very surprising they even proposed not possible data preparation staff figures mistake.
 
The data from the China Iron and Steel Association (China Iron & Steel Association). The Association statistics, 70% of the member's actual data, the estimated production of non-member steel plant. The discrepancy about the actual steel production has been a topic of dispute over China Steel Industry Association and the China National Bureau of Statistics. Nomura said that the small steel mill in China may have reduced the scale of production, but the China Iron and Steel Association, no reasonable taking into account the reduced production of these factories.
 
However, a more ominous possibility is that Chinese steelmakers do not want to slow down the speed of production, even though demand is weak.
Nomura seems to agree with the latter possibility, said that despite weak demand, the Chinese steel mills currently not on price signals to respond.
 
Analysts believe that is to blame has been hit hard steel industry plagued by overcapacity, as well as strange not to develop too dispersed ownership system of production targets.



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