Wang Yifang, president and general manager of giant Chinese steelmaker Hebei Steel Group, said on March 6 that steel producers in China can hardly make any profit given the current steel price.
Mr. Wang remarked that steel prices have been moving on a fluctuating trend, with five major fluctuations observed last year. Although the current steel price is fairly reasonable, steel producers cannot make any profit since the raw materials purchased previously were rather expensive. However, if steel prices are raised to RMB 6,000/mt ($879/mt), this will obviously will have a great influence on the downstream industry chain, he said.
In addition to the price factor, excess capacity is another problem facing the steel industry, the Hebei Steel Group president commented. He said Hebei Steel has been focusing on the elimination of unqualified steel capacities and is planning to eliminate its remaining 10 percent unqualified capacity in 2010.