Discussion On The Countermeasures Of The Scrap Steel Industry In The Economic Downturn With Overcapacity

- Dec 14, 2020-

In the context of severe overcapacity of crude steel and the sharp drop in steel prices, the decline of steel scrap, which is closely related to the steel market, has continued to fluctuate. Whether it is a scrap trader or a scrap steel processing industry, both are "seriously injured". Where is the way out? The "Twelfth Five-Year Plan" proposes that the future development direction of scrap steel is to establish a scrap steel processing and distribution system. The establishment of the scrap steel processing and distribution system has increased the enterprise's ability to resist risks. It is a win-win opportunity for the steel enterprises and the scrap steel industry. Facts also show that this approach is correct. According to comprehensive media reports, under the sluggish steel market, Sugang focused on developing the scrap steel processing and distribution industry and achieved sales of 1.9 billion yuan throughout the year. Establishing a scrap steel processing base, relying on strength and scale can indeed resolve risks and overcome economic difficulties to win victory. However, for small and medium-sized scrap steel processing owners, it is not an overnight task. A gradual and gradual development process is required. In the face of the current crisis, how to deal with it, provide some suggestions for reference. 3.1 Use information collection methods to investigate the market in depth In order to grasp the market changes as soon as possible, the breadth and depth of information should be expanded and explored. As a priority way of price setting, procurement is carried out by taking network information, combining field research, and comprehensively considering the purchase price of various suppliers. Pricing, this move can receive good results. 3.1.1 Expand the coverage of information In order to accurately understand the latest market price trends, the market information of the four websites of "Asian Metal, United Metal, My Steel, and Steel Home" should be used as an important source of information for understanding the scrap steel market. Daily large-scale collection and understanding of relevant scrap iron and steel information on 4 websites, and establish a price information database based on the information on the 4 websites. 3.1.2 In-depth expansion of information sources In addition to large-scale collection of website information, it is also necessary to pay attention to on-site investigations of scrap iron and steel markets in various regions. The raw material procurement personnel should frequently go to the planned acquisition area to conduct market research, expand the coverage of the research work, and focus on the in-depth exploration of information collection in some key areas, so as to provide first-hand market information for procurement pricing. 3.1.3 Pay attention to the collection of information on various scrap steel suppliers Several pig iron and scrap steel suppliers with a certain scale and strength should be selected from a number of suppliers, and supplier statistical reports should be established, respectively, from the supplier’s purchase price, purchase volume, inventory, etc. subject Statistics, so as to further understand the amount of scrap iron and steel resources, resource trends and market prices of various suppliers and surrounding markets. 3.2 Optimize the structure of procurement varieties Increase the purchase of heavy steel scrap through multiple channels, and change and optimize the structure of the purchase of scrap steel. The following methods can be adopted: a policy of one case, one discussion for high-quality steel scrap, price of scrap steel according to quality and variety, to prevent the loss of high-quality scrap resources; send special personnel to the supplier's base for on-site inspection and supervision of installation, and purchase of scrap steel The quality is controlled at the "source", and the quality of the goods is paid close attention to while completing the purchase quantity. 3.3 Pay attention to the management of scrap steel classification Pay attention to the detailed classification of steel scrap, and redefine the classification of steel scrap. The original heavy steel scrap can be divided into heavy steel scrap I and heavy steel scrap II according to its external dimensions, thickness and unit weight; the original medium steel scrap can be divided into medium steel The waste of high-quality resources can be avoided by implementing new classification standards for scrap I and medium-sized scrap II.