Abstract China's traditional economy is rapidly declining. As a hub of global manufacturing and trade, China's excitement has fallen sharply. This means that the profit model of traditional manufacturing has become impractical. All of them are built around a series of industrial chains built by China at that time, or Upgrade, or transformation,...
China's traditional economy has rapidly declined. As a hub of global manufacturing and trade, China's excitement has fallen sharply. This means that the profit model of traditional manufacturing has become impractical. All of them are built around a series of industrial chains built and built in China at that time. , or transformation, or death. The manufacturing chain is undergoing painful restructuring.
The first is the sad logistics industry.
Reuters reported that the benchmark container freight rate for the Asia-Europe route has plummeted by 70% in the past three weeks, the most serious decline since the global financial crisis in 2008. The Shanghai Container Freight Index shows that container shipping from Asia to the northern European ports fell by 27.9% to $295 per 20-foot TEU for the week ending November 20. The freight rate in the previous week has dropped by 39.3%, and the drop in the past three weeks has reached a staggering 70%.
As of November 20, as the "wind vane" of the commodity market, the Baltic Dry Index (BDI) fell to 498 points in 20 days, falling below the historical low of 509 set on February 18 this year. In the past week, freight rates in major ports in Asia to the Mediterranean fell by 22.5%, freight rates on the West Coast of the United States fell by 8.6%, and freight rates on the East Coast of the United States fell by 8.0%.
The inconsistency in shipping prices means that trade is extremely low. China's recessionary trade surplus cannot boost freight. Recently, it has been very difficult to communicate with friends who are doing logistics. The current situation is very bad. There are still some goods exported at the end of the year. Returning to the air.
Unlike the previous short economic cycle, China may experience a brief downward adjustment in the decade after 2000. Iron ore prices, copper prices, and shipping indices will rise. This time, it is an essential change, and the regional economy has undergone a major shift. Don't expect China to become a moving ant transferer like in the past. From South America, Canada, Australia and other countries, it is constantly moving into raw materials and transferring goods to the world to earn hard labor. Now China wants to be a "coolie" and it is cheaper. Better labor resources are not in China, and China's industrial structure can only go up, and it will slip into poverty if it is stagnant.
Commodities confirm the cruel reality of the manufacturing industry, breaking down and no resistance.
On November 22nd, the latest price of LME three-month copper was 4,553 US dollars per ton. On November 17, the market exclaimed that copper price hit a six-year low, which was 4,590 US dollars per ton. In February 2011, the highest price was 10189. The dollar is simply unbearable. The tragedy is not over. Financial services company INTLFCStone Inc. analyst Ed Meir said copper prices may fall to a six-year low of $3,800 per ton next year, with China accounting for 45% of copper world consumption.
After the financial crisis, copper experienced several stages in China. When industrial sales decreased, copper increased imports and increased inventory, becoming a financing collateral. Qingdao Port financing copper scam was exposed.
Copper prices have fallen sharply, and Chinese prices are often ahead of international prices. In January of this year, LME copper fell more than 11% within two days. At that time, the Shanghai Futures Exchange copper contract fell, forcing orders to flow into the LME market in the early hours of London. The decline is even more fierce. Reuters Andy Home's column shows that while the Shanghai Futures Exchange's copper price has fallen, the open interest and volume have surged. The two short positions in the Shanghai Futures Exchange's January 2016 copper futures are Haitong Futures. And the East China Sea futures, both in the January copper price plunged have played a decisive role. Investors are now betting on further declines in commodities.
Goldman Sachs’s report on “The Alarm of Metals for China’s “Old Economy†(released on November 17, 2015) raised the situation of commodities and the current and short-term activities of China’s 'old economy’ and the growth of metal demand The alarm bell sounded.
Indulging in the old economy and indulging in the upswing of the economic cycle will have unrealistic optimism. Enterprises can't hold any luck, big companies are taking action. Maersk Group, the world's largest shipping company, has announced that it will cut 4,000 jobs worldwide, accounting for about one-sixth of its land workers. CMA CGM is negotiating to buy the Singapore Oriental Sea King Group (NOL). If the transaction is completed, the world's third largest shipping company will buy the largest shipping company in Southeast Asia. China Merchants and China Shipping Changhang, Zhonghai and COSCO are also seeking mergers and acquisitions.
Only when a new round of economic growth is found will the commodity price enter the rising channel. The last bull market was because China joined the WTO. The warning before the end of the bull market was that Mr. Tong of Sumitomo Mitsui Banking Bank lost $4 billion in just 34 trading days from May 31, 1996. Now, it is Glencore's debt and stock price crisis. If it is not a strong hand of God, I am afraid that companies such as COSCO will also be on this list.
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