Su Changyong: “China to maintain its position as world's steel manufacturing and consumption center”

Thursday, 02 December 2021 16:13:11 (GMT+3)   |   Istanbul
       

On the second day of the 16th SteelOrbis Steel Conference “New Horizons in Steel Markets” held Thursday, December 2, online, Su Changyong, deputy secretary general of the CISA and president of the Metallurgical Industry Press in China, started his speech by discussing changes in major macroeconomic indicators in China in the 2019-21 period. According to shared information, in the January-October period of this year gross domestic product (GDP) in China grew by 4.9 percent, while infrastructure investment increased by one percent, both year on year. Meanwhile, in October, the business activity index of the Chinese construction industry was 56.9 percent, down 0.6 percentage points from the previous month, but indicating that construction industry production is still maintaining its continuous growth.

As for the steel industry, Mr. Su stated that in the first 10 months this year China’s pig iron output declined by 3.2 percent to 24.3 million tons, its crude steel production decreased by 0.7 percent to 877 million tons, steel production increased by 2.8 percent to 1.1 billion tons and iron ore output by 11.5 percent to 823 million tons, all year on year. In October alone, China's crude steel production was 71.58 million tons, up 23.3 percent, its pig iron output came to 63.03 million tons, down 19.4 percent, and output of steel products amounted to 101.74 million tons, down 14.9 percent, all year on  year. In terms of imports and exports, in the first 10 months of this year, Chinese steel exports increased by 29.5 percent to 57.518 million tons, while imports decreased by 30.3 percent to 11.84 million tons. However, it seems that during the past four months, China’s steel exports are moving on a downward trend, which is related to the cancellation of export tax rebates for 23 types of steel products. Meanwhile, in the January-October period, the cumulative apparent crude steel consumption in China reached 840 million tons, down 3.5 percent year on year. In October alone, the apparent crude steel consumption in the country decreased to 69.43 million tons, down 26.1 percent from the previous month. 

As for the raw material market, according to Mr. Su, in October China’s imports of iron ore decreased by 14.2 percent to 91.61 million tons and the average import price was $137.1/mt, up 14 percent, both year on year. In the first 10 months of this year, imports came to 933 million tons, down by 4.2 percent and the cumulative import price averaged $175.9/mt, up 73.7 percent. Domestic pig iron production is currently on par with December 2018. Meanwhile, in September, coke production in China decreased by 9.6 percent to 37.18 million tons, while in the January-September period it increased by 1.3 percent to 357 million tons. In the same period, China exported 5.17 million tons of coke, up by 99 percent, while imports of coking coal came to 35.08 million tons, down by 40.8 percent, both year on year. The reason for the sharp fall in imports was imports from Australia decreasing to zero from 31.6 million tons in the same period last year.

Mr. Su stated that the overall performance of China's steel industry in 2020 can be summarized as a good year of "reduced quantity and improved quality", in line with policy guidance and market expectations. This year, the annual steel production in the country is expected to be about 1.03 billion tons, with steel consumption of about 990 million tons, which are the second highest annual levels in history, to achieve a basic equilibrium of total supply and demand. Also, China's steel demand is expected to decrease by 2-3 percent in 2021, and to remain roughly at 2021 levels in 2022. “After the stimulus policy of dealing with the new Covid-19 pandemic and promoting economic recovery has achieved its result, demand for steel will inevitably turn into normal demand. During the 14th Five-Year Plan period, China's total steel consumption will remain at a high level, and China will continue to maintain its position as the world's steel manufacturing and consumption center,” he said.

In his speech, Su also underlined China’s “dual carbon” goals, which includes “carbon peaking” and “carbon neutrality.” He said that China will aim to achieve peak CO2 emissions before 2030 and carbon neutrality before 2060 and these two goals will require extensive and profound systematic changes both economically and socially. In order to achieve these goals, “China will follow the path of high-quality development that prioritizes ecological preservation and boosts green and low-carbon development,” the CISA official stated. Meanwhile China’s roadmap includes high efficiency and light-weight use of steel, and increasing the efficient recycling of iron resources such as scrap steel. Mr. Su stated that one of the main difficulties for the Chinese steel industry is insufficient metal reserves. “Europe, the US and many other countries have fully achieved industrialization, forming a relatively adequate steel accumulation. The main raw material for steel production is not primary resource iron ore, but secondary resource recycled steel (scrap steel), while China still mainly uses iron ore as raw material for production,” he said. The other factors, which may be burdens for the Chinese steel industry in reaching their goal, are dealing with both pollutants and emissions, and high risks and high costs for breakthrough low-carbon technologies, for which international cooperation seems necessary, according to Mr. Su.


Similar articles

Ukraine’s ArcelorMittal Kryvyi Rih posts lower pig iron output due to Russia’s attacks on energy infrastructure

21 Mar | Steel News

Ukraine’s ArcelorMittal Kryvyi Rih posts increased outputs for January

01 Mar | Steel News

Metinvest’s pig iron and crude steel output down in 2023

21 Feb | Steel News

ArcelorMittal Kryvyi Rih’s capacity usage at 25-40% in 2023 due to impact of war

25 Jan | Steel News

Ukraine’s Metinvest sees lower pig iron and crude steel outputs in Jan-Sept

16 Nov | Steel News

Mechel’s output and sales mainly decrease in H1

31 Aug | Steel News

Metinvest’s pig iron and crude steel output fall in H1

18 Aug | Steel News

Russia’s Mechel posts higher crude steel and pig iron outputs for Q1

01 Jun | Steel News

Ukraine’s Metinvest posts higher pig iron and crude steel outputs for Q1

16 May | Steel News

Russia’s Mechel posts slightly higher crude steel and pig iron outputs for 2022

24 Mar | Steel News