Undoubtedly, cold rolled products are widely used in most countries now. Cold rolled products are major materials in many industries such as automobile, household appliance,
construction, tools, etc. and the quality of cold rolled products has remarkable influences on the
production of related value added products. At the same time, both quality and output of cold rolled products are the key factors used to show the productivity level of steel industry in a country.
In 2005,
China's steel
consumption added up to 375 million tons with 20 percent year on year growth rate. But high quality or high value-added steel products were still depending on import, to meet the local requirement. Among the imported goods,
galvanized, pre-painted and thin cold rolled products accounted for 48 percent of the total. Since 2003, some new cold rolling lines have been built in
China. Although the investment is huge, the supply still can not meet the demand. In 2005,
consumption of cold rolled products, excluding the strip and the
stainless, was 28.3 million tons, but only 59 percent of this was produced in
China. In other words, 61 percent of the
consumption was imported. As to these imported cold rolled products, if they are ranked by the actual import quantity, 0.5-1.0 mm takes the first place, followed by that below 0.5 mm. About 73.8 percent of the total imported steel products were below 1 mm thick cold rolled products last year.
In recent years,
China's self-support rate of cold rolled products always fluctuated around 50 percent which could be interpreted as nearly half of cold rolled products had to be imported, although the cold rolled output kept on increasing. Nevertheless there are some challenges lying beyond cold rolled output increase:
- Building a new CR line needs much higher technology and many advanced machines that also depend on importing from abroad.
- Besides huge investment, usually the building period of a new CR line lasts about 30 months and the
production capacity is comparatively limited compared to the HR line.
- At present, with the background of huge demands for thin CR products in
China, although new CR lines continued to be built and start to work, productivity for CR products in
China is still lagging far behind the market's needs.
According to statistical data from the Government, in 2004, building of two new cold rolling lines started, with a capacity of 2 million tons per year. In 2005 and 2006, building of 20 more cold rolling lines are planned. Currently, almost all of the most advanced CR
production technologies in the world have been introduced to and put into use in
China. To satisfy the domestic market demand is the objective of each steel manufacturer in
China. For this purpose, steel makers need to take more measures to achieve their goal and in fact, some of these measures are currently being taken by means of following practices:
First of all, building more specialized CR lines is important. Here, “specialized” stands for two meanings; one refers to thin CR lines. As just mentioned above, no matter if the CR products need further processing - such as galvanizing, most imported CR products have thicknesses below 1 mm. The other meaning is special purpose of products made on the CR lines, such as to be used in auto body.
Second measure taken is to speed up the processes of building a new CR line. It's too long to wait for 30 months to complete a new line. There are also potential risks in building such a long term project. If during the building period, competitors take effective measures managing to shorten the building period or even increase the planned number of lines, the new CR line's products will have to face up fierce competition.
Third measure is, to accelerate the studies carried out on advanced productive technologies to produce high quality CR products and expand the output on base of current producing conditions. Perhaps this is the most effective way to increase shares in the current market.
Although generally speaking, the actual steel
production capacity in
China is already more than the demand of the entire local market, in the fractionized CR market, the demand is still huge and waiting for being met. It still has a high chance for success and worths investing in.