Future seems bright for China's steel industry

SteelOrbis Shanghai The 2007 Steel Industry Situation Report/Mysteel Annual Conference held in Shanghai on November 26 drew a rosy picture regarding the future of China's steel industry. Speaking at the conference, Hu Mingyang, an expert from the Metallurgical Industry Economic Development Research Center, stated that the special steel industry had seen positive development in 2006. From January to September, special steel production totaled 36.79 million mt, up 7.57 percent year on year, and also enjoyed a good sales performance. Bar exports totaled 154,695 mt, wire rod 103,822 mt, super heavy plate 52,532 mt, heavy plate 239,785 mt, medium plate 84,529 mt, sheet 199,153 mt, and seamless pipe reached 612,698 mt. Hu estimates that due to the good prospects for demand in 2007, prices may be expected to see a climb. Speaking in relation to the real estate market, Gu Yunchang, the vice-president of China Real Estate Research Association, forecast that the good trend in the real estate market would last for a long time. From January to September this year, investment in real estate increased 24.3 percent, completed area increased 8.7 percent, while saleable area increased 10.5 percent – evidence of brisk commercial activity. Chen Luru, a delegate of the Expert Committee of the China Steel Construction Society also mentioned that expansion in China's steel construction sector was continuing. Steel construction output totaled 15 million mt in 2005, up 13 percent year on year. According to Chen, China's steel construction products can now essentially meet domestic demand for steel structures. However, he went on to say that steel mills cannot or are not willing to provide some special varieties of steel construction. He recommended that the steel mills should make greater efforts to improve their technological capability in the future. Jia Xinguang from the China Automobile Industry Association said China would produce approximately 8.2-8.3 million cars in 2007. In the January-Septemper 2006 period, China's vehicle production volume increased 25.74 percent year on year to 5.2832 million. Meanwhile, sales reached 5.17 million for the same period, up 25.01 percent. Automobile production and sales are expected to exceed seven million in 2006, he added. Tan Naifen, secretary-general of China's National Shipbuilding Industry Association said that the shipbuilding industry had achieved great progress over the last 20 years. At present, there are approximately 890 shipbuilding enterprises in China, he said, among which the China State Shipbuilding Corporation (CSSC) and the China Shipbuilding Industry Corporation are the two largest. Furthermore, China's shipbuilding industry has already claimed a remarkable share in the world market. Mr Naifen predicted that the shipbuilding industry would remain a hot growth area for a relatively long period of time.