(Minews) - China’s crude steel production capacity is expected to continue growing for a long time before peaking at 850 million tpy, according to the China Iron & Steel Assn (Cisa).
The association’s executive vice secretary-general, Li Xinchuang, disclosed this forecast at Metal Bulletin’s China Iron Ore conference in Beijing on Tuesday February 25.
He did not say when this peak will be achieved.
Li pointed out that there was no way that China’s crude steel production would hit one billion tonnes as the state of the country’s environment simply would not allow it.
The Chinese government is implementing stricter regulations on steelmakers with a view to cut pollution. The most recent move was in Tangshan, where the local government ordered steel mills to cut production after the air quality index in the region surged to hazardous
levels.
“It is true that China’s economic growth is slowing down, but I cannot foresee it sliding down to below 6% at the moment,” Li said.
Mills’ profitability is unlikely to improve this year, he said, as steel demand growth is expected to fall to 3.2% from 8.5% last year.
Competition among steel mills will become fiercer, he said.
China’s slower economic growth will result in a similar trend in fixed-asset investment and automobile consumption. Steel exports are likely to grow at a slower pace as well, Li pointed out.
