MNI China Press Digest July 3:Overcapacity, Exports, Logistics

Highlights from Chinese press reports on Thursday:

• Several industries have announced a new round of cuts to overcapacity after the Central Financial and Economic Commission meeting urged the orderly withdrawal of obsolete production, Securities Times reported. Authorities have notified certain steel mills to limit production, while leading photovoltaic glass companies announced a 30% production cut starting in July, after prices fell below the cost. Steel and photovoltaic sector' stock prices saw a surge in daily limits on Wednesday.
• Hot weather in Europe has driven a 30% increase in demand for Chinese exported air conditioning units, industry insiders told Yicai, with one company chief considering moving production to Europe to bypass trade policies and increase brand influence. China’s sales were further improved by the EU’s demand for environmentally friendly and cost-effective products, Yicai said. Looking ahead, leading companies such as Midea and Haier should enter the high-end market and shift from price to value-based competition, a researcher said.
• The China Logistics Prosperity Index (LPI) reached 50.8 in June, up 0.2 percentage points m/m, according to the China Federation of Logistics and Purchasing. The index, which measures the sector’s overall health, showed a slight increase in business volume mainly driven by improved demand in eastern regions and the weakening of external shocks, said Hu Haon, deputy chief economist at the China Logistics Information Center. Looking ahead, logistics firms faced pressure given the early arrival of flood season, Hu added.