Analysis of the Development Status of China's Steel Trade Market

The bank created the prosperity of the steel trade market It is reported that as early as the middle and late 1990s, Ningde Zhouning people began to go to Shanghai to engage in the steel trade business. Zhou Ningren's "One Belt One, One Gang One" gradually formed the largest group in the steel trade industry.

With the macroeconomic trend, banks have gradually relaxed, and after 2001, the steel trade began to enter a period of rapid expansion. More and more people from Zhouning and neighboring counties and cities began to flood the industry. It was also in this year that the steel trade began to evolve from an initial pure industrial operation to a mode of scale and normalization.

Due to the hunger for funds, some banks at the time seemed inconceivable to start the above-mentioned 20% interest rate lending to steel traders, but steel traders' businesses can grow bigger and bigger. Such initiatives have caused banks to follow suit. In the end, the demand for steel traders by banks was completely liberalized. During the peak period, the ** interest rate went up even as high as 40%.

Since then, the steel trading industry has begun to enter a period of admiration for countless people. The Shanghai Steel Criterion Zhu Junhong once said: “This is an era when pigs will fly.” As long as you have the courage to dare to get goods, you must Can make money. ”

The data shows that during the rapid expansion of the decade from 2001 to 2010, steel production showed a “45 degree” increase. During this period, from steel mills to distribution to end-users, the average profit per ton of steel was as high as 300-500 yuan. "If we take 700 million tons of output and 300 yuan in profits, there will be a 210 billion yuan spread for the market to share." Zhu Junhong said that such a large spread and huge consumption amount created a decade of steel trading companies. The glory.

For hundreds of thousands of steel traders, 2009 is undoubtedly the most memorable year for them. After the financial tsunami, the “four trillion” stimulus policy was introduced, and Yingen began to relax. The State Council issued "Financial Article 30", emphasizing the relaxation of SMEs on several occasions.

Since this year, banks and steel traders have entered the "honeymoon period." Steel traders began to comprehensively and fully appreciate the bank’s enthusiasm for fire. According to the above steel traders' memories, at that time, the bank’s managers came to visit and asked for help to complete the mission. From the original one to twenty million, the ** rose to one hundred million units.

"A set of one million yuan houses can get loans of 1.5 million yuan from banks." Some steel traders said that in order to fight the big cake in the steel trade industry, major banks have begun a service competition. Assets that had previously only had a discounted mortgage began to become more “valuable”. "At the time, in the eyes of the bank, Zhou Ning was synonymous with Fujian steel traders. As long as there is an identity card for Zhou Ning, there is a way to lend 5 million yuan from the bank."

The decline in steel prices, “Unified Insurance” led to the destruction of steel traders as early as the beginning of 2000, Zhou Huarui opened the door of Shanghai Steel Trade. At that time, the Yixian Steel Market he operated pioneered the model of five-unit joint security, chattel mortgage, and guarantee agency guarantees. This was hailed by banks as an important financial innovation.

The feature of this ** model is that banks give steel traders **, and generally the guarantee companies established by the steel market guarantee the individual. Even if retail investors are unable to repay loans, the strong guarantee companies and steel market owners will also compensate, and banks will sit back and relax.

A steel trader explained to the reporter what Wuhu Insurance was and five steel trade companies formed UNPROFOR households, each of which received 1 million yuan**, a total of 5 million yuan. At this time, every steel trade company needs to bear 5 million yuan. If one runs away, then the other four need to jointly repay another one million and run two, then the remaining three need to jointly repay the remaining 2 million.

In the early years, after some people from Ningde locality took a firm foothold in the steel trade industry in Shanghai, friends and relatives in their hometown would again flock to “treat” and go to the steel trade business. Over time, among the more than 20,000 steel trading companies in Shanghai, steel traders from Fujian Zhouning are the absolute main force. It is precisely this kind of relationship that "is not relatives or fellow villagers." It provides natural conditions for five households.

In fact, in the large and small steel trade markets in Shanghai, the powers are quite amazing. There are as many as 400 merchants in the medium-sized steel market. Assuming that each business has a loan quota of 2 million, the guarantee company can receive 30% of the guarantee money from it, so that the margin of the guarantee company will exceed 200 million yuan.

“It is plainly that the steel trade is a bank pick-up.” For some steel traders, as long as they understand the use of funds, they do not pay for it at the time. After purchasing luxury cars and other expenses, a lot of the rest of the funds have entered the property market, *** and other profiteering industries, where the profits flow.

According to some local Zhou Ning memories, in the past Spring Festival to go home, will see numerous luxury cars will be packed in the Zhouning County crowded, small Zhouning county became a luxury car booth.

However, from the first quarter of 2012, the price of steel fell sharply. In September of that year, the price of rebar dropped from 5,300 yuan/ton in the first quarter to 3,300 yuan/ton. The steel trade comrades established on the steel industry have also collapsed and all involved parties have not been spared.

According to the data released by the Ministry of Industry and Information Technology, the sales profit of 80 key large and medium-sized steel companies in 2012 decreased by 98.2% year-on-year, and the profit rate was almost zero. The continuous real estate regulation is even worse, and the worsening of the environment has directly lengthened the recovery period for steel traders. Monetary policy tightened, banks began to draw loans, leaving steel traders vulnerable to the fragile funding chain.

Today, fewer luxury cars travel to and from the county seat. Some locals lamented that “many banks have seen the identity cards at the beginning of 352 (the Ningde District), and they haven’t even given it to them. It’s really three decades of Hedong and thirty years of Hexi.”

Banks and steel traders began to frequently report to the court that media reports had reported that from the beginning of August, there were as many as 302 cases of disputes in the steel trade and finance industry in the Shanghai area to be held within a month. Among them, there are 29 steel trade cases involving the Minsheng Bank, and there is an average daily litigation. In fact, as early as last September, Minsheng Bank, China Everbright Bank and many other banks began to frequent Shanghai district courts, and the defendants were basically steel trade companies. According to the Shanghai Court website announcement, from March 18 to April 17 this year, there were more than 200 banks filing suits against steel traders in Shanghai, involving 23 banks. In 2012, when the bank recovered the high tide of steel traders and businessmen (October 15 to November 15, 2012), the total number of similar lawsuits was only 27 cases. There is a peculiar honeycomb-shaped glass curtain wall building in the Shanghai Dabaishu area. This is the Shanghai Steel Exchange Building. At one time, this building was a gathering place for many steel traders and traders from Ningde Fujian in Shanghai. At the time of its peak, it was stationed in 575 merchants. The entrance to the steel city was full of luxury cars. Its developer is Zhou Huarui, founder of the First Steel City. It used to be the area with the most concentrated banking outlets in addition to Lujiazui in Shanghai. Zhou Huarui proudly said: "Almost every bank will set up branches in the business district." Today, with the steel price plummet, steel trading companies deep in the debt crisis, has long been a matter of fact. It is understood that the enterprises supported by the Shanghai Zhouning Chamber of Commerce before, except for the two companies specializing in steel processing, have all disappeared in the steel trade circle in Shanghai. Some people were completely "hidden" to hide; some of the venues were still there, but even the personal shadows were gone. In early 2000, Zhou Huarui established the steel trade model. The general manager of the bank's sales department that he worked with now is now the branch manager or vice president. But now the days of these governors are not very good. Many recovery teams assigned to banks have led the mighty debt collection army to catch up with Zhou Ning, only to check the hidden property of these steel traders in their hometowns. The monthly salary of 2,000 yuan was held, and the bonuses had to be drawn from the rewards they had collected.

According to sources in the banking industry, many banks in Shanghai are involved and the amount involved is huge. “Some banks are also paying their own blood to these steel trading companies to help them repay interest. After all, if they go bankrupt, it is not a good thing for the banks.”