Group 1: Hot News - As of the end of June this year, China's banking industry's total assets are nearly 470 trillion yuan, ranking first in the world; the stock and bond market sizes rank second in the world; and the foreign exchange reserve scale has ranked first in the world for 20 consecutive years. The total assets of the banking and insurance industries currently exceed 500 trillion yuan, with an average annual growth of 9% in the past five years; trust, wealth management, and insurance asset management institutions manage nearly 100 trillion yuan in assets; "white - list" project loans exceed 7 trillion yuan, supporting the construction and delivery of nearly 20 million housing units [2] - The People's Bank of China kept the one - year and five - year loan prime rates (LPR) unchanged at 3% and 3.5% respectively [2] - The cobalt export ban in the Democratic Republic of the Congo, which has been in effect since February this year, will end on October 15, and a new export quota policy will be implemented. The annual export quota ceiling is set at 96,600 tons in 2026 and 2027 [2] - The Ministry of Industry and Information Technology and other departments jointly issued the "Steel Industry Steady Growth Work Plan (2025 - 2026)", setting the average annual growth target of the steel industry's added value at about 4% in the next two years. By the end of 2025, more than 80% of steel production capacity should complete ultra - low emission transformation [3] - As of the week ending September 21, the good - to - excellent rate of US soybeans was 61%, lower than the market expectation of 62%, the previous week was 63%, and the same period last year was 64%. The soybean harvest rate was 9%, lower than the market expectation of 12%, the previous week was 5%, and the same period last year was 12% [3] Group 2: Key Focus and Night - Session Performance - Key commodities to focus on are urea, Shanghai copper, silver, crude oil, and PVC [4] - Night - session performance by sectors: Non - metallic building materials 2.58%, precious metals 31.73%, oilseeds and oils 10.70%, soft commodities 2.46%, non - ferrous metals 19.14%, coal, coke, steel, and minerals 14.23%, energy 2.93%, chemicals 11.93%, grains 1.05%, and agricultural and sideline products 3.25% [4] Group 3: Large - Class Asset Performance - Equity: The Shanghai Composite Index rose 0.22%, the CSI 300 rose 0.46%, the SSE 50 rose 0.43%, the CSI 500 rose 0.76%, the S&P 500 rose 0.44%, the Hang Seng Index fell 0.76%, the German DAX fell 0.48%, the Nikkei 225 rose 0.99%, and the UK FTSE 100 rose 0.11% [7] - Fixed - income: The 10 - year treasury bond futures rose 0.20%, the 5 - year treasury bond futures rose 0.13%, and the 2 - year treasury bond futures rose 0.04% [7] - Commodities: The CRB commodity index fell 0.41%, WTI crude oil fell 0.05%, London spot gold rose 1.66%, LME copper rose 0.13%, and the Wind commodity index rose 3.06% [7] - Others: The US dollar index fell 0.35%, and the CBOE volatility index was unchanged [7]

Core Viewpoint - The Ministry of Industry and Information Technology, along with other departments, has issued the "Steel Industry Growth Stabilization Work Plan (2025-2026)", setting an average annual growth target of around 4% for the steel industry's added value over the next two years [1] Group 1: Policy Objectives - The plan emphasizes "stabilizing growth and preventing internal competition" as its core focus, guiding structural adjustments and high-quality development in China's steel industry [1] - It proposes precise control of capacity and output, promotes graded and classified management of steel enterprises, and prohibits the addition of new capacity [1] Group 2: Implementation Strategies - The plan aims to guide resource allocation towards competitive enterprises, facilitating a survival of the fittest approach through output regulation to achieve dynamic supply-demand balance [1] - Experts highlight that "equipment upgrading" and "low-carbon transition" will be the two core competitive issues in the future [1] Group 3: Environmental Standards - Steel enterprises are required to accelerate the elimination of outdated equipment, particularly old blast furnaces and converters that are restrictive in production [1] - The plan specifies that by the end of 2025, over 80% of steel production capacity must complete ultra-low emission transformations [1]

Core Viewpoint - The Ministry of Industry and Information Technology, along with four other departments, has issued the "Steel Industry Growth Stabilization Work Plan (2025-2026)", emphasizing the need for low-emission transformation and energy efficiency improvements in the steel sector [1] Group 1: Emission Reduction and Energy Efficiency - The plan aims to fully complete the ultra-low emission transformation targets by the end of 2025 [1] - Support will be provided for steel enterprises to implement energy efficiency enhancement modifications and promote the substitution of clean energy [1] - The industry will conduct research on collaborative pollution reduction and carbon reduction technology pathways [1] Group 2: Low-Carbon Technologies - The plan supports research and development of low-carbon common technologies such as hydrogen metallurgy [1] - It emphasizes accelerating the pilot verification and industrialization of integrated processes and equipment for green electricity, green hydrogen, and pure hydrogen metallurgy [1] Group 3: Digitalization and Carbon Management - The industry is encouraged to establish digital carbon management centers [1] - There will be a focus on developing a carbon footprint accounting standard system for steel products and enhancing carbon measurement management [1] - The plan aims to improve the quality of carbon accounting data and ensure proper quota trading and settlement after inclusion in the national carbon emission trading market [1]

Report Industry Investment Rating No relevant content provided. Core Viewpoints of the Report - The main contract price of rebar fluctuated higher with a daily increase of 0.73%, and the volume and open interest contracted. The supply - demand pattern has improved, but downstream demand concerns remain. With cost increases and policy expectations as positives, steel prices are expected to continue to fluctuate. Attention should be paid to demand performance [4]. - The main contract price of hot - rolled coil fluctuated with a daily increase of 0.18%, volume decreased and open interest increased. Demand resilience is weakening, supply remains high, the supply - demand pattern has weakened, inventory has increased again, and coil prices are under pressure. With cost increases and production restrictions as positives, the subsequent trend is expected to be weakly fluctuating. Attention should be paid to demand performance [4]. - The main contract price of iron ore was strongly fluctuating with a daily increase of 0.81%, and the volume and open interest expanded. Pre - holiday ore demand is okay, supporting high - level prices, but demand resilience will weaken, supply is rising, and the fundamentals are expected to weaken. High - valued ore prices have limited upward momentum, and the trend is expected to continue high - level fluctuations. Be wary of intensified industrial contradictions [4]. Summary by Relevant Catalogs Industry Dynamics - The Chinese Ministry of Commerce hopes that the EU will not weaponize tariffs, eliminate market barriers, and encourage fair competition, and jointly create a fair market environment for the industry [6]. - Shanghai has optimized and adjusted policies on the pilot personal housing property tax. Eligible homebuyers for the first - set home are exempt from property tax [7]. - Ningxia has released a draft plan for air pollution prevention and control in the winter - spring of 2025 - 2026, requiring 3 steel enterprises to complete key project renovations by the end of December 2025 [8]. Spot Market - Rebar: Shanghai price is 3,230, Tianjin price is 3,210, and the national average is 3,298 [9]. - Hot - rolled coil: Shanghai price is 3,420, Tianjin price is 3,320, and the national average is 3,444 [9]. - Other: The price of 61.5% PB powder at Shandong ports is 799, and the price of Tangshan iron concentrate powder is 798 [9]. Futures Market | Variety | Closing Price | Increase/Decrease (%) | Volume | Open Interest | | --- | --- | --- | --- | --- | | Rebar | 3,172 | 0.73 | 1,250,591 | 1,970,510 | | Hot - rolled coil | 3,374 | 0.18 | 459,672 | 1,413,153 | | Iron ore | 807.5 | 0.81 | 379,811 | 574,521 | [13] Related Charts - Include charts on steel and iron ore inventories (rebar, hot - rolled coil, national 45 - port iron ore, etc.), production conditions (247 - sample steel mill blast furnace start - up rate, etc.) [15][20][30]. 后市研判 - Rebar: Supply has decreased due to losses, demand has improved but is still at a low level in recent years. With cost and policy as positives, steel prices are expected to fluctuate. Attention should be paid to demand [39]. - Hot - rolled coil: Supply has increased, demand has weakened, and the supply - demand pattern has deteriorated. With cost and production restrictions as positives, the price is expected to be weakly fluctuating. Attention should be paid to demand [39]. - Iron ore: Demand is okay before the holiday but will weaken, supply is rising, and the fundamentals are expected to weaken. High - valued ore prices are expected to fluctuate at a high level. Be wary of contradictions [40].

Group 1 - The core viewpoint of the article indicates that the profitability of the general steel sector is at a low point, with the ROA for H1 2025 being 0.93%, the lowest level since 2010 [4] - The PB_LF of the general steel sector is currently at 0.96, which is 6.67% below the average since 2013, and significantly lower than the peaks in 2017 and 2021 by 83% and 69% respectively [5] - Among the general steel companies, 12 firms have a PB_LF below 1, with notable companies like Hebei Steel, New Steel, and Ansteel having PB_LF of 0.51, 0.52, and 0.54 respectively [6] Group 2 - Currently, 11 companies in the steel sector have a dividend yield above 3%, with the highest being Youfa Group at 6.09% [7] - The completion of ultra-low emission transformations in the industry is expected to further enhance the dividend payout ratios of general steel companies [8] - The average capital expenditure for the general steel sector from 2020 to 2024 is projected to be 82.4 billion, significantly higher than the average of 65.4 billion from 2010 to 2019, with expectations of a decline in capital expenditure post-2026 [9]

Group 1 - The company held a performance briefing session on September 15, with participation from 29 institutions, discussing its development prospects and key work [1] - The company is responding positively to the "anti-involution" policy, focusing on stabilizing operations, preventing risks, improving quality, optimizing structure, promoting transformation, and increasing efficiency [2] - The company is currently evaluating the feasibility and compliance of a significant asset restructuring plan disclosed in June 2023, which may impact its independent operational capabilities [3] Group 2 - The company issued 6.8 billion in convertible bonds in 2020, with a remaining balance of 5.631 billion, and is focusing on enhancing company quality through cost reduction and efficiency improvements [4] - The company is committed to ecological priorities and green development, planning to complete ultra-low emission modifications by October 2025, with significant reductions in pollutant emissions expected [5]

Group 1: Company Capacity and Production - The company's total production capacity is 8 million tons, with 3 blast furnaces and 5 converters [1] - The annual production capacity includes 1.8 million tons of wire rods, 2.98 million tons of rebar, and 1.35 million tons of medium-thick plates [1] - The joint venture with JFE has 2 special steel rod production lines with an annual capacity of 1.18 million tons [1] Group 2: Main Products and Applications - Main products include rebar, medium-thick plates, and wire rods, primarily used in construction and infrastructure [2] - Rebar is widely used in civil engineering projects such as buildings, bridges, and roads [2] - Wire rods are utilized in manufacturing fasteners and components for automotive and electrical machinery [2] Group 3: Environmental Initiatives - The company completed a comprehensive ultra-low emission transformation assessment in April 2024, with an investment of 3.3 billion CNY, including 400 million CNY for clean transportation [2] Group 4: Financial Performance and Dividends - The company reported a significant increase in sales volume and a decrease in costs in Q2, recovering from a production drop due to maintenance in Q1 [2] - Dividend history includes 1.5 CNY per share in 2019, 2 CNY per share in 2020 and 2021, and 0.3 CNY per share in 2022 despite losses, totaling 1.404 billion CNY in recent years [2] - Future dividend plans will be developed in accordance with regulatory guidelines for 2026-2028 [2]

Summary of Steel Industry Conference Call Industry Overview - The conference call focuses on the steel industry in China, particularly the supply and demand dynamics for 2025 [1][2]. Key Points and Arguments - **Steel Production Decline**: In the first seven months of 2025, China's crude steel production decreased by 3.1% year-on-year. To meet the annual reduction target of 5%, a further reduction of 7.9% is required from August to December [1][4]. - **Steel to Crude Steel Ratio**: The ratio of steel to crude steel reached a new high of 1.43 in the first half of 2025, indicating potential underreporting of crude steel production. Certain provinces have shown abnormal cutting ratios, suggesting the presence of illegal production capacity [1][5]. - **Carbon Emission Regulations**: The implementation of carbon emission quota systems is expected to reduce underreporting and overproduction behaviors among companies, leading to more standardized crude steel production [1][6][7]. - **Ministry of Industry and Information Technology (MIIT) Initiatives**: MIIT proposed a grading system for steel mills, categorizing them into compliant, leading, and non-compliant enterprises, with differentiated support policies. Ultra-low emission modifications are now mandatory, increasing production costs [1][10]. - **Cost Implications of Emission Modifications**: The ultra-low emission modifications will add approximately 200 RMB per ton to production costs, with 150 RMB being variable costs and 50 RMB for depreciation. This will raise the overall cost line for the industry, supporting steel price increases [1][11]. - **Export Growth**: From January to July 2025, China's net crude steel exports increased by 23.6% year-on-year, driven by genuine overseas demand, particularly from the Middle East and Africa [1][12][14]. - **Supply and Demand Outlook**: The steel industry is currently experiencing weak policy and demand expectations. However, as domestic demand shifts towards peak season, supply and demand conditions are expected to improve in the fourth quarter [2][3][17]. Additional Important Insights - **Policy Implementation**: The effectiveness of annual production control policies remains uncertain, with only partial reductions observed in specific regions [4][8]. - **Future Reporting Trends**: Steel mills tend to report higher production figures to the environmental department for carbon credits while underreporting to the MIIT. Future regulations may reduce discrepancies in reporting [7][9]. - **Investment Recommendations**: Recommended stocks include leading companies such as Baosteel, Hualing, and high-quality southern enterprises. Shougang is highlighted for its reduced depreciation costs, which could significantly enhance its performance [18]. This summary encapsulates the critical insights from the conference call regarding the current state and future outlook of the steel industry, emphasizing production trends, regulatory impacts, and investment opportunities.

Group 1: Sales and Production Insights - The company's steel sales volume in the first half of the year was 11.1 million tons, a year-on-year decrease of 12.6% [2] - The steel sales volume, excluding direct sales of steel billets, saw a decrease of approximately 10% [2] - The company plans to adjust production rhythm based on downstream order demand and profitability, expecting annual production and sales to match [2] Group 2: Industry Trends and Policies - The steel industry is experiencing a supply-side contraction due to strict policies on crude steel capacity and self-discipline among steel enterprises [2] - Approximately 80% of the industry capacity is expected to complete ultra-low emission transformations by the end of the year [2] - The new 2025 version of the steel industry normative conditions aims to optimize supply and eliminate backward production capacity [3] Group 3: Financial Performance and Cost Management - The company's second-quarter performance improved significantly due to a notable decline in raw material prices compared to steel prices, leading to better profitability [4] - Cost management efforts have led to improved efficiency across various cost indicators, including process, procurement, and energy costs [4] - The company is focusing on high-end steel products, maintaining a stable market share and profitability in niche markets [4] Group 4: Demand and Market Conditions - The third quarter is traditionally a slow season, with a decrease in demand for thin plate products, although some segments like automotive steel show improvement [5] - The company anticipates that industry profitability may narrow in the third quarter due to rising raw material prices, particularly coking coal [5] Group 5: Project Developments and Future Outlook - The non-oriented silicon steel project is progressing well, with the first production line expected to meet demand from key clients in the automotive sector [6] - The VAMA joint venture is operating at near full capacity, with total sales around 1.6 million tons [7] - Future developments for VAMA include the introduction of advanced steel grades and the construction of a third phase project, which is currently in feasibility studies [8][9]

Investment Rating - The report maintains a "Positive" investment rating for the steel industry, indicating a favorable outlook for mid-term investment opportunities [6]. Core Insights - The steel industry is expected to experience high-quality and high-return development, driven by the "anti-involution" policy, which is anticipated to catalyze production cuts and stabilize steel prices, thereby enhancing profit margins for steel companies [9][21]. - The supply-side structural issues are likely to reverse, leading to a balanced supply-demand scenario that can stabilize industry profits [9][23]. - A significant oversupply of iron ore is expected in the mid-term, with a projected increase in supply outpacing demand, which will likely lead to a decline in iron ore prices and subsequently enhance profitability for steel companies [9][19]. Summary by Sections Introduction - The "anti-involution" policy was officially introduced in July 2024, aiming to prevent vicious competition in the steel industry, which has been significantly affected by declining demand and overcapacity [13][21]. Supply-Side Structural Issues - The report highlights that the ultra-low emission transformation in the steel industry is nearing completion, with over 76% of total capacity having undergone some form of transformation by July 2025 [30][32]. - The report anticipates that the completion of these transformations will help eliminate the "bad money drives out good" phenomenon, leading to a more equitable competitive environment [33][41]. Iron Ore Supply and Demand - The report forecasts a strong oversupply of iron ore, with supply growth expected to exceed 5% annually until 2026, while demand is projected to grow only modestly [9][19]. - This oversupply is expected to lead to a significant decline in iron ore prices, which will enhance the profitability of steel manufacturers [9][19]. Dividend Potential - The report suggests that with reduced capital expenditures and stable profits, steel companies are likely to increase their dividend payouts, indicating a shift towards high-quality, high-return development in the industry [9][24]. Investment Recommendations - The report recommends focusing on steel companies with high gross profit elasticity, such as Shandong Steel and others, for short-term investments, while suggesting long-term investments in companies with stable dividend levels like Baosteel and Hualing Steel [9][24].