SteelOrbis Shanghai
According to the data recently announced by the Chinese National Bureau of Statistics, China's urban fixed assets investments continued to remain steady at a high level during January-October 2007. In recent months, however, a remarkable rebound has been observed in the increase rate of investments in the steel sector.
In the January-October period, urban fixed asset investment increased by 26.9 percent to RMB 8,895.3 billion ($1,197.2 billion).
Breaking this figure down according to various industries relevant to the steel industry, for the period in question investment in coal mining and processing reached RMB 125.8 billion ($16.9 billion), up 24.2 percent year on year; investment in petroleum and natural gas exploration totaled RMB 144 billion ($19.4 billion), with a rise of 12.3 percent compared to January-October 2006; investment in non-metal mineral products came to RMB 215.9 billion ($29.1 billion), with an increase of 53.5 percent; investment in smelting and pressing of ferrous metals totaled RMB 198.2 billion ($16.7 billion), up 14.5 percent; investment in smelting and pressing of non-ferrous metals reached RMB 98.3 billion ($13.2 billion), up 33.4 percent; investment in the production and supply of electric power and thermal power amounted to RMB 601.7 billion ($81 billion), up 9.4 percent; and, finally, investment in railway transport reached RMB 159 billion ($21.4 billion), with a rise of 7.9 percent.
The rebound in the growth rate of investment in the steel industry appears as a matter of concern. In the first quarter of this year, the cumulative growth of investment in the steel industry was 12.7 percent, while the cumulative growth in the January-July period dropped quickly to 9.2 percent. However, the figure started to rebound swiftly in August, providing evidence that it may not be so easy to curb steel industry capacity expansion in the short term.