Insight
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7 Pages

China: Debt burdens driving steel into bankruptcy


China: Debt burdens driving steel into bankruptcy

Report summary

China’s steel plants are facing increasing pressure from growing credit tightness. Many steel plants are heavily indebted and dependent on short term debt. As a result, a number of steel plants defaulted on their loans, the effect of which is felt far beyond the local economy in which the steel plant operated. In this insight, we investigate the reasons for this new trend, and the implications of the potential for more defaults.

What's included?

This report includes 2 file(s)

  • China: Debt burdens driving steel into bankruptcy PDF - 530.36 KB 7 Pages, 2 Tables, 3 Figures
  • Credit tightness.xls XLS - 241.00 KB

Description

This Metals Insight report highlights the key issues surrounding this topic, and draws out the implications for those involved.

For industry participants and advisors who want to look at the trends, risks and issues surrounding this topic, this report gives you an expert point of view to help inform your decision making.

Our analysts are based in the markets they analyse and work with high-quality proprietary data to provide consistent and reliable insight.

We provide unique in-depth analysis of the metals supply industry so you can make confident strategic decisions.

  • Executive summary
  • Credit availability dries up as money supply tightens
  • Rising short term debt increasing vulnerability to a credit shock
  • A wave of bankruptcies already in process
    • Table 1: Examples of steel companies bankrupt in 2013
    • Table 2: Struggling steel companies, Q1 2014
  • Implications

In this report there are 5 tables or charts, including:

  • Executive summary
  • Credit availability dries up as money supply tightens
    • Chart 1: M2 and steel sector capacity growth, 2007-2013
  • Rising short term debt increasing vulnerability to a credit shock
    • Chart 2: Chinese steel: Rising debt, rising risk
  • A wave of bankruptcies already in process
    • China: Debt burdens driving steel into bankruptcy: Table 1
    • China: Debt burdens driving steel into bankruptcy: Table 2
    • China: Debt burdens driving steel into bankruptcy: Image 3
  • Implications
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