China's iron and steel investment slows down

China’s iron and steel investment slows down

China's investment in the iron and steel industry increased 18.6 percent year on year to RMB 97.4 billion (approximately $12 billion) through the first half of 2005. The 2005 first-half investment growth is a marked decrease from the previous year, when investment had climbed 51.6 percent from 2003. Despite the slow-down in investment growth during the first half of 2005, capacity expansions that were brought on-stream during that period translated into a 28.25 jump in crude steel output. China, which produced 164.86 million tons of crude steel through June of this year, is expected to surpass 300 million tons of crude steel production by the end of the year. The country produced 272 million tons of crude steel in 2004. Meanwhile, growth in the country's iron and steel consumption fell 4.3 percentage points year on year to 15.7 percent in the first half. The decrease in the consumption growth led to oversupply, which in turn caused a drop in the country's domestic steel prices.