Xinhua News Agency reported Qi Xiangdong, Vice Secretary-General, China Iron and Steel Association, saying that the reverse trend in steel exports from Dec.’06 to Jan.’07 has been credited to slow production and curtailments in tax rebates. Qi projected net exports of steel billets and rolled steel to fall by 10 Million Tons in 2007.
The General Administration of Customs reported that 4.38 Million Tons of steel was exported by China in January, up by 12.2% on 2006. However, the value came down by 21% from December 2006. China imported 1.48 Million Tons of steel in January, down by 6.2% from the previous year.
Industry analysts believe that slumping steel exports are also a result of China’s government’s concerns over the amount of trade disputes, if the country continues to raise its steel imports.
However, the existing situations appear comparatively constructive for steel production in the nation.
China anticipates to clock in around 460 Million Tons of crude steel production in 2007, a straight 10% growth over 2006, says the State Development and Reform Commission.
In 2006, China’s crude steel production reached 418.78 Million Tons, 18.48% higher than the last year. The growth rate registered was 7.28% lower than 2006, which, industry analysts believe, could be a reason for declining exports.
The Commission sources believe that the demand for automotive, transport, machinery, construction, home appliances, petrochemical, shipbuilding, and electric power sectors will remain strong in the next few years.
However, aggressive expansion of production capacity and continuous hike in prices of raw materials, like iron alloy, imported steel scrap, and iron ore, will be the key issues ahead for the steel industry, said the Commission sources.
According to the RNCOS report, “China Steel Industry Analysis (2006)”, during the earlier phase of rapid development, the industry has caused various structural issues, including lack of industrial concentration, imbalanced product mix, and overcapacity.
Dependence on imported raw material, FDI barriers, overcapacity, and import restrictions are the main challenges for the China’s steel industry.
The research report also discusses the structure of China steel industry, past and current performance of the industry with statistical data, future projections and trends, demand supply analysis, and opportunities and challenges for the industry.
RNCOS, incorporated in the year 2002, is an industry research firm. It has a team of industry experts who analyze data collected from credible sources. They provide industry insights and analysis that helps corporations to take timely and accurate business decision in today's globally competitive environment.