According to the China Iron and Steel Association (CISA), Chinese crude steel output increased by 5.2 percent in 2020, while the apparent consumption of crude steel in China rose by nine percent in the given year. In particular, demand for steel coming from the construction industry rose by 10 percent year on year in 2020.
In 2020, China’s net exports of crude steel declined by 67.6 percent year on year amid the decline in steel exports and rise in steel imports, while its iron ore imports amounted to 1.17 billion mt in the given year, up 9.5 percent year on year.
The composite steel price index (CSPI) indicated an increase of 17.36 percent year on year to 124.52 points as of December 31. In particular, steel prices in the January-August period were lower, while were higher in the September-December period, compared to the same periods of the previous year.
According to the CISA, steel demand in China in 2021 will likely rise slightly amid the steady development of the economy. Steel exports are unlikely to improve much, while imports will increase due to the Covid-19 pandemic in the global market and the strict control of production in China.
At the same time, the high levels of raw material prices - including iron ore, coal, coke and scrap - will exert a negative impact on Chinese steelmakers’ profitability.