Huaxi Steel: The supply side of the steel industry may continue to shrink, effectively resolving the long-term structural contradictions in the steel industry.

Huaxin Steel recently stated during institutional research that the steel industry is still in the bottom range, with significant contradictions between supply and demand, but there are signs of stabilization and recovery. The current promotion of "anti-insulation" is a long-term mechanism to address the adjustment of the domestic economy and overseas uncertainties, which is conducive to further regulating the market order of the steel industry. In recent years, steel companies have consciously adjusted their production pace according to demand and profit situation, and self-discipline production reduction, especially in the off-season of the third quarter in previous years, has become an industry consensus. The mechanism of industry self-restraint and resource concentration towards superior enterprises is forming. In the future, it is believed that with strict government control on crude steel production capacity, implementation of production control, and joint efforts with steel companies' self-discipline production reduction, the supply side of the steel industry may continue to contract, effectively resolving the long-term structural contradictions of the steel industry.