Wang Lianzhong, deputy secretary general of China Chamber of Commerce for Metallurgical Enterprises (CME) stated that according to CME’s data, China’s crude steel output, pig iron output and finished steel output in the year of 2019 are expected to amount to 995 million mt, 800 million mt and 1.2 billion mt, up 7.0 percent, 3.8 percent and 9.1 percent year on year.
Mr. Wang said the steel industry will make full use of market and legal means to promote the merger and reorganization of steel enterprises, to improve industrial concentration, intensify the reform of mixed ownership and enhance the market vitality and international competitiveness among steel enterprises.
In particular, crude steel output by private steel enterprises amounted to 506 million mt in the January-October period of the year, up 11.14 percent year on year, accounting for 61.04 percent of the total crude steel output in China in the given period. He expected that crude steel output by private steel enterprises will amount to 600 million mt in the whole year of 2019, up 9.69 percent year on year, accounting for 60.3 percent of the total crude steel output in the given year.
Mr. Wang forecasted that China’s steel industry will likely realize an overall gross profit of RMB 240.5 billion ($34.3 billion) in the year of 2019, while private steel enterprises will register an overall gross profit of RMB 158 billion ($22.5 billion) in the given year, accounting for 66 percent of the overall steel industry’s gross profit. In particular, Shandong Province-based Shiheng Special Steel, Hebei Province-based Puyang Iron and Steel and Jiangxi Province-based Fangda Special Steel will record the highest profit per mt, likely reaching RMB 995/mt ($141.9/mt), RMB 690/mt ($98.4/mt) and RMB 613/mt ($87.4/mt), respectively.
Wang said the rising import iron ore prices and declining finished steel prices have contributed to the year-on-year decrease in steel enterprises’ profit in the year of 2019, with the year-on-year decline likely being 40 percent.