On November 27th 2015, Minmetals Development Co. Ltd affiliated to China Minmetals Corporation and Ali Venture Investment affiliated to Alibaba Group announced jointly that the both parties agreed to inject more capital to Minmetals E-commerce, the subsidiary of Minmetals Development Co. Ltd in order to set up B2B platform of steel trade.
MPI's comments: The steel industry is grasping at straws to survive by means of e-commerce platform, which is helpful to change marketing mode and to reduce operation cost. Despite being valued by steel industry, the steel e-commerce must find out its own way to get profit surviving against long-term loss. It is also not recommended to establish steel e-commerce platform repeatedly.
According to the latest economic data released by the National Bureau of Statistics, total profit of industrial enterprises above designated size in October decreased by 4.6% year-on-year, which was 4.5 percentage points higher than the drop in September. The total profit from January to October decreased by 2% year-on-year, up 0.3 percentage points comparing with the same from January to September.
MPI's comments: It is inevitable for steel companies to reduce production and cost, improve efficiency and cut debt ratio. The steel industry should strengthen reform of the supply front to eliminate the overcapacity.
