b'SEPTEMBER 26 - OCTOBER 23, 2022PROJECT CARGO BI-ANNUAL13(PRESSUREcontinuedyearsandisexpectedtomajorcitiesdropped13%inChinassteelproductionThesteelsectorcould from page 4) remain so in 2022, accord- month over month in August.during the fourth quarter, butbenefitfurtherifChinas ore futures declined by one- ingtoareportfromS&PLongfor Group, a Chinesethehousingsectorprobablyeconomystartedtorespond thirdbetweenmid-JuneGlobalCommodityInsights.property developer, projectedwont be contributing to anytothegovernmentstimu-throughtheendofAugust,Themainreasonsbehindin late August that the valuesuchrevival.Theuptickinlusandhomebuyerswere before ticking up in early toslowedsalesincludestalledof Chinas new home sales iniron and steel futures prices inmotivatedbylowerinterest mid-September,demonstrat- population growth, near com- 2022 would drop by 30% yearearly September likely camerates, but that probably wont ingthattraderslackconfi- plete urbanization, and stag- on year. Between January andas a reaction to developmentshappen this year. The down-dence that the governmentsnanthouseholdincomedueJuly, the value of new homein the automotive sector. turn in Chinas debt-strapped stimulus policies are going toto the pandemic resurgence.sales dropped 29% year overMetals and steel demandpropertysector,concluded work to aid infrastructure andUrbanizationhasdrivenyear,accordingtoChinasfromautomotivehasstartedtheS&PGlobalCommodity manufacturing.Chinas property developmentNational Bureau of Statistics. toincreaseagainasthecarInsightsreport,isunlikely AsCOVIDlockdownsandsteelconsumptionoverOntopofallthat,aindustryhasreboundedfromto be reversed at least within continuedtoweighonthethe past 20 years. Sixty-fourmortgage strike is spreadingseveral lockdowns and vehicle2022.Inthelongerterm, Chinese economy, some fore- percent of the Chinese popu- across China, with homebuy- sales are supported by govern- its worth noting, home con-casterscutChinasGDPlation moved to metropolitaners withholding payments onmentinitiatives,However,struction will still face secu-growth estimates for this yearareasby2020,accordingtoloans across hundreds of resi- this surge in demandcannotlar economic headwinds from to3%,downfrom8.1%inS&P Global, and experts saydentialprojectsthroughoutcompensatelossesfromthecompletedurbanizationand 2021 and well below Beijingsthat urbanization slows downthe country. Because propertyconstruction decline. low population growth.targetof5.5%.Worldsteelafter that number reaches 60%.developersinChinatendtoThe same is confirmed byShould the property sector documenteda6.4%declineChinaspropertysalessell residences before devel- the state-owned, Shanghai-basedshowsignsoflifesooner insteelproductioninChinatrendedlowerinAugust,opment has been completed,Baosteel,whichannouncedratherthanlater,thesteel thisyearthroughtheendofdown 31% year over year, fol- some developers wont haveonAugust31thatChinasindustry wont benefit imme-JulyandareportfromS&Plowing a 16% decline in July,thefundstocompletetheirsteeldemandwouldbegindiately.Evenifnewhome Globalshowedsteelimportsaccordingtodatafromtheprojects as a result. torecoverduringthefourthsalesbegintoincreaseinthe into China slowed by 65.2%ChinaRealEstateInforma- th quarter, but that steel demandfourthquarter,saidtheS&P during the first half of the year.tionCorporation.Thesame4Q uarterr ebound ? would remain under pressureGlobal report, developers will data showed that floor spaceSome observers are lookingas the property sector remaineddivertmostofthemoneyon Covidands teeL ofChinashomesalesin30for some form of resurgencein a deep adjustment. securing project completions.Chinaszero-COVIDpolicy has taken its toll on the Chi-neseeconomy,andstate-sponsored stimulus may not be enough to galvanize a revival, at least in the short run. Its aquestionofwhetherthe moneyisactuallyspent, accordingtoAlMunroat brokerMarex,aUK-based financialservicesplatform, in a note to traders. China took less than two months to contain the origi-nalCOVID-19outbreakin 2020 and the Delta variant inCLOSER2021. But when Omicron hit this year, it took China three monthsfromearlyMarch to early Juneto control the outbreakinShanghai.This has exacted a toll on the Chi-nese economy and has come withacontinuingprice,as othercitiesandregionsinON THE COLUMBIA RIVER IN WASHINGTON STATEChinasuchasZhuozhou,FASTERanindustrialcitynorthof Beijingwerelockeddown evenafterShanghaiopened on June 1.FrequentCOVIDout-breaks,masstesting,and lockdowns, said Munro, are acting as a handbrake for the ChineseeconomyandwillDIRECT CONNECTIONS TO MAINLINE RAIL & INTERSTATE HIGHWAYScontinue to do so.toshowSMARTERDatacontinue poor construction steel demand in China. Steel production in Tangshan,amanufacturing centerinHebeiprovince, will fall by nearly 11% in the second half of this year com-pared to the first half, accord- STORAGE OPTIONS & FOREIGN TRADE ZONE SPACEingtoMinmetalsFutures,BETTERaChinesestatebrokerage headquarteredinShenzhen. Atradius,thetradecredit insuranceconcern,expects steeldemandinChinato decrease 0.7% in 2022.h ousinGs eCtorChinasappetiteforsteelON-DOCK RAIL & DUAL-SERVED BY BNSF & UPhaslongbeendrivenby thehousingsector,which accountsforone-thirdof Chinas steel consumption. New propertydevelopmentinCONTACT US AT [email protected] | PORTOFLONGVIEW.COMChinahasbeenonadown-wardtrendforthepastfew'