China's crude steel output is expected to rise 3 percent to 832 million tonnes this year, and by a further 0.7 percent in 2018, as major mills ramp up operations, offsetting the impact of the shutdown of outdated plants, a government body said on Monday.
Output in 2018 will be 838 million tonnes, said the China Metallurgical Industry Planning and Research Institute (MPI) in a report.
"The growth comes after Beijing's crackdown on illegal low-grade steel products, which were never included in the official statistics," it said.
"The supplies are now filled in by legal steel mills."
A strong rebound in China's industrial activity this year, led by steel and other metal producers, has helped produce forecast-beating economic growth of nearly 7 percent.
The world's largest steel maker produced 808 million tonnes of crude steel in 2016 and eliminated around 120 million tonnes of low-tech steel product capacity in the first half of this year.
Iron ore demand in the world's top buyer is expected to rise 1.3 percent to 1.122 billion tonnes this year from 2016 and dip 0.2 percent to 1.12 billion tonnes in 2018, according to the MPI report.
The MPI expects that China will export a net 63 million tonnes of steel products in 2017 and 2018, up 3 percent and 0.7 percent respectively.