China's Ministry of Industry and Information Technology (MIIT) has stressed the current difficult situation in the domestic steel industry, with iron ore costs, freight charges and finished steel outputs at high levels, while prices have not increased much. On the positive side, steel exports have indicated a relatively positive performance.
Jia Yinsong, official at the raw material department of the MIIT, stated that this year the price of iron ore has doubled, with the Q2 import iron ore price 90-100 percent higher year on year, the increase in freight costs has also had a great impact, while domestic finished steel output is at a record high. In April, domestic finished steel output was 1.85 million mt, equivalent to an annual output of 670 million mt. Against these factors, steel prices had seen only small increases, he said.
Mr. Jia also pointed out that Chinese domestic steelmakers are under pressure to make energy savings and reduce emissions, to eliminate backward capacities, to overcome international trade frictions, while also facing the pressure of rising raw material costs and weakened finished steel demand.