Speaking at the SteelOrbis 2023 Fall Conference & 89th IREPAS Meeting held in Istanbul on September 17-19, Hüseyin Ocakçı, Deputy General Manager and Middle East general manager of CIEC Group, gave a presentation regarding the outlook for the Chinese steel market.
Starting with the production, export and import data for China, Mr. Ocakçı noted that the country’s crude steel production has continued to increase in 2023 with daily crude steel production increasing by 122,000 mt and capacity utilization at 92.76 percent currently, while the country’s total crude steel production came to about 91 million mt in July this year. The Chinese mills have not yet cut output in accordance with the government’s restrictions on crude steel production for the current year.
According to the data provided by the CIEC official, China exported 7.31 million mt of steel in July, including 4.69 million mt of flat products and 886,000 mt of long products, while its billet imports, mainly coming from Russia, totaled 19,000 mt in March 2023 and its slab imports amounted to 138,000 mt in the given month. He also pointed out that the impact of its export volumes is not as significant for China as it is for other countries, as China’s local steel consumption accounts for 95 percent of its production.
Regarding the real estate industry in the country, Ocakçı stated that it remains weak despite the stimulus policies issued for the sector, such as lower loan interest rates and reduced downpayments for first-home buyers.
Drawing attention to increasing raw material prices, especially iron ore and coking coal, the CIEC official stated that producers are losing margins given their high raw material costs. Saying that Chinese companies will not be able to maintain competitive their price policies, he anticipates that the decline in steel prices will stop as there is not much room for them to move down further.