Speaking at the 2014 China Coal, Coke & Steel Industries Conference (CCIC) held in Qingdao on August 21, Wang Xiaoqi, vice chairman of the China Iron and Steel Association (CISA), stated that in the first seven months of the current year China's average daily crude steel output exceeded 2.2 million mt and so China's overall crude steel output in the current year is expected to reach 830 million mt.
According to the CISA, in the January-July period this year China's apparent consumption of crude steel amounted to 438 million mt, down 960,000 mt or 0.2 percent year on year, while its finished steel exports in this period indicated a significant increase of 36.9 percent year on year to 49.07 million mt.
In addition, in the first half of the year, fixed asset investments by the Chinese steel industry amounted to RMB 237.5 billion ($38.56 billion), down 7.08 percent year on year, with this decline in fixed asset investment the largest recorded among the 56 industrial sectors in China in the given period. The CISA vice chairman said that this indicates that expansion of production capacity in China has finally been curbed, which will ease the oversupply situation in the country.
Mr. Wang also said that the high-growth period for Chinese demand for finished steel has ended, and, though iron ore and coking coal prices have moved down, finished steel prices are unlikely to see a significant recovery, which will thereby limiting the steel industry's profit margins.
