Posted on 28 Oct 2021
Chinese steel mills will be need to be ready for a series of changes in the market as both the national economy and the industry are in a new era, He Wenbo, executive chairman of the China Iron & Steel Association, shared at a recent meeting with representatives from 17 major steel mills in China.
"The steel industry needs to adapt to new changes and plan ahead, and with all the complexity, instability and uncertainties, the Chinese steel mills will need to be mindful of changes in global competition..., changes in the demand..., and any challenges during production restriction," he said.
Overseas steel production and capacities have been gradually recovering while China's steel production have been correcting downward, which will lead to changes in the global production structure, market, and competition, he explained.
Besides, steel consumption among the end-users has shown some fundamental changes, which should be the foundation for steel mills to decide on the allocation of their steel capacities in the future after the latest round of output adjustment.
As for the ongoing production curbing, it has achieved some positive results, but it has also exposed some issues in industrial regulation and stimulation efforts, all of which need to be rectified, according to He.
In the long run, the Chinese steel mills should be prepared and at the same time having faith in the government' leadership and capability to deal with all the changes, and the successful readjustment of the country's steel demand and supply balance in the past few months has been a clear illustration.
In September, China's daily crude steel output fell to a three-year low of about 2.46 million tonnes/day, down 21.2% on year or 8.45% lower on month, and it was also down 24.6% from the peak in April, mainly due to the government's curtailing efforts.
At the same time, though, Chinese steel mills should be relying more on self-discipline than government's direct command and adjusting supply in accordance with actual demand themselves as well as striving to achieve sustainability in supplies of resources, he added.
For the rest of the year, all the Chinese steel mills should abide by the curtailing in both steel output and capacity and at the same time helping stabilize both the prices and supplies, as well as to close the year with rather healthy performance, he highlighted.
Source:Mysteel Global
