On January 9, the inauguration ceremony for the Shanxi Steel Industry Structure Adjustment Fund, which is funded by Shanxi State Investment Corporation, Shaanxi Province-based Shaanxi Blower (Group) Co., Chinese state-owned Capital Engineering and Research Incorporation Limited (CERI), and Beijing-based Chinese company Jianlong Group, was held in the city of Yuncheng city, Shanxi Province. The adjustment fund in question is estimated to have an overall scale of RMB 50.0 billion ($7.7 billion) in total, while the first installment to be issued will amount to RMB 5.0 billion ($0.77 billion).
The Shanxi Steel Industry Structure Adjustment Fund is the first Iron and Steel Industrial Structure Adjustment Fund in China to be jointly established by private sector and state-owned enterprises.
Zhang Zhixiang, president of Jianlong Group and chairman of the China Chamber of Commerce for Metallurgical Enterprises, stated that low concentration ratio is the biggest problem for China’s steel industry. For instance, in 2015 the top four steelmakers in Japan accounted for 83.3 percent of the overall capacity of the domestic steel industry, the top four steelmakers in US accounted for 70.0 percent, the top eight steelmakers in EU accounted for 64.9 percent, while in the same year the top ten steelmakers in China accounted for only 34.2 percent of the overall capacity of the Chinese steel industry. The Shanxi Steel Industry Structure Adjustment Fund is expected to boost the development of the steel industry in Shanxi Province, he said.
Mr. Zhang also stated that China's crude steel output in 2017 is estimated at 870 million mt, with the top ten steelmakers’ output estimated at 522 million mt, equal to an average of more than 50 million mt for each producer.