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Trade dispute escalation

According to the Sino-US trade war, it has been nearly four months since the March 301 investigation of China's steel and aluminum has continued until the subsequent Sino-US trade negotiations. June 15 is the day the White House has set a list of final tariffs on Chinese products. According to US media reports, US President Trump will discuss with high-level trade officials on the 14th local time to decide whether he will announce tariffs on Chinese exports to the United States on the 15th. According to the "Wall Street Journal" reported on the 14th, the US trade representative Wright Heze's office will announce the final tax increase list for imported products from China as early as 15th. The White House has previously said it will impose a 25% tariff on Chinese goods valued at $50 billion shortly after the list is released. Some sources also said that US trade officials have reached a consensus and agreed to impose tariffs. The final list may be reduced in size, but high-tech products such as semiconductors may be included. As the market speculates more and more, the US side The news has been scheduled to draft a list of 301 tariffs on China. At the same time, the official voice of China has finally landed. On June 15, the Chinese Ministry of Commerce issued an official statement on the US tariff increase, saying that it will introduce the same scale and the same strength to the US. Taxation measures, and all economic and trade achievements reached by the two sides before the consultation will be invalidated at the same time. During the Dragon Boat Festival, the US publicly threatened to add a $200 billion tax collection list in addition to the previous $50 billion in commodity taxation. Then, on June 19, the Ministry of Commerce issued a statement counterattack, saying that it would adopt a combination of quantitative and qualitative measures to counter the US practice. The trade war has been upgraded at a rapid rate, with many adverse effects. From the face of the disk, the domestic market was deeply affected by the trade war incident, the market plummeted, the thread broke 3800, the iron ore broke 450, and the coke 2100 fell. As of the close of the morning of the 19th, the main thread of the thread closed at 3781 and fell 101, and the main volume of the hot coil fell 3859. 103, iron ore main strength closed 448.5 fell 23.5, coke main force closed 2096.5 fell 78, coking coal main strength closed 1206 fell 43, Zheng coal main strength closed 648 fell 1.6. Since then, the trade war has been upgraded in a new round. Although the Sino-US trade issue has not been properly resolved after many consultations, the future trade dispute will continue to escalate, which is unfavorable for the entire trading environment and the stability of the domestic market. It is expected that the market will be affected in the short term and tend to fluctuate again.




Whether the production limit is slow, when the resumption of production begins

In terms of production restrictions, with the large-scale production restrictions in the country, many provinces and cities have imposed restrictions on production and limited work. Taking Jiangsu Province as an example, Jiangsu Province has implemented a major production restriction activity. Starting from October 2017, the Xuzhou Economic and Trade Commission’s “Xuzhou Industrial System Heavy Pollution Weather Emergency Plan” requires the start of the Xuzhou Industrial System to be heavily polluted. The early warning program will limit the production of steel and cement clinker enterprises in the city by more than 50%, and the coking enterprises will be out of focus for more than 48 hours. The remaining cement grinding, brick and tile enterprises will be discontinued. In December, the Jiangsu Provincial Environmental Protection Department held an emergency meeting to organize relevant departments and inspectors to deploy the provincial winter air pollution prevention and control provincial patrol inspections until March 31, 2018. The production restriction operation has lasted for more than half a year. It is expected that the production restriction operation will end in June 2018. However, the pace of environmental protection inspectors has not stopped yet. From June 11 to June 24, the provincial air pollution The supervision team began to supervise and unannounced visits to various regions of Jiangsu Province, and it was still supervised according to the plan of limiting production by more than 50%. The pace of resumption of production was slow. On June 15th, Xuzhou Southeast Steel Plant started the first step of resumption of production today, and began to heat the hot blast stove of No.3 blast furnace in the boiler to start the first step of heat storage for the blast furnace. It is estimated that this hot blast stove needs 1 week of heat storage. Time can slowly open other steps, and it is expected that the molten iron will be officially released in early July. Based on this speed calculation, it is expected that the resumption of production will start in July.


Another conference-type limited-production city is also well received by the market, that is, Qingdao, Shandong. The SCO summit held the steel mills in Shandong area early in the tension. In order to ensure the local air quality, the polluting enterprises around Qingdao began to stop production and limit production. The enterprises mainly involved key industries such as petrochemical, chemical, coking and cement. The production stoppage time is around June 20, and the production suspension period is about one month. With the successful convening of the meeting from June 9 to 11, the production restriction policy was gradually unfrozen. From the port's point of view, starting from June 12, the main port of the Hong Kong motor transport collection port has returned to normal, the car transport standard can be shipped normally, in addition, port loading and unloading operations have gradually recovered. In terms of steel enterprises, there are 11 steel enterprises affected by the SCO summit. As of the 12th, 6 steel enterprises have returned to normal, and 3 steel companies will resume operation in the near future. 8 enterprises affected by sintering will be affected. There have also been two production resumes.

Steel price trend under environmental protection and limited production

How is steel price affected in the tight atmosphere of environmental protection and trade competition? Here, we take three major cities as examples. First, the representative city of East China, Shanghai, in early June, rebar prices are in the shock range, close to the middle, and gradually increased, as of the 13th, the price is 4120 yuan / ton. The increase or decrease increased by 60 yuan on June 7, ushered in a high position and fell rapidly. On the 12th, the price rose by 50 yuan. As of the 13th, it increased by 40 yuan from the previous day. The overall price in the middle is in a period of continuous growth.

Afterwards, the eyes turned to the representative city of Xi'an in the northwest region. It can be seen that before June 6, the price of Xi'an rebar was around 4020. From June 7th, the price was rapidly increased from 4080. As of the 13th, the price has risen to 4120 yuan / ton, the rapid rise, from the increase and decrease, the trend is similar to Shanghai, but the increase or decrease is not the same, after falling 10 yuan on June 5, began to rise, June 7 And it has rebounded by 40 yuan. After that, there was another fall. As of June 13, the increase and decrease were in a small shock period.

The final concern is Tianjin, the representative city of Tianjin, Tangshan, Tianjin rebar prices are not as good as Shanghai and Xi'an, the highs in the first half appeared from June 7 to 8, at 3,950 yuan / ton, from 12 to 13 in a small fluctuation phase. As of the 13th, the price has risen again to 3,980 yuan / ton. In terms of increase and decrease, the growth rate is still relatively violent. It fell by 30 yuan on the 5th and 30 yuan on the 6th. The performance in the middle rose slightly. Until the 13th, the rebar price increased by 40 yuan from the previous day.

Throughout the three cities, it is not difficult to find that rebar prices were in a period of volatility in June, especially in the three days of 11, 12, and 13 days, showing continued growth. In terms of price, Xi'an and Shanghai prices rose to 4,120 yuan / ton as of June 13, while Tianjin rose to 3,980 yuan / ton, weak performance. The average price of Xi'an rebar has been above 4,000 in mid-June, and its performance is strong. In terms of increase and decrease, the price of rebar in Shanghai increased by a large margin, and the price fluctuated sharply. Of course, in addition to the environmental protection and production policy affecting steel prices, the trade war will be upgraded again to disturb the market. In the future, the national thread price trend will fluctuate downward.

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